Pharmaceutical company Merck announced this morning its intentions to buy out rival Schering-Plough in a merger that will further consolidate the pharmaceuticals and health products industry. Merck will pay $41.1 billion in cash and stock for the rival, just six weeks after the announcement of the Pfizer-Wyeth merger.
Richard T. Clark, Merck’s chairman, president, and chief executive who will also head the newly combined company, was optimistic about the future company. “We are creating a strong, global healthcare leader built for sustainable growth and success,” he said. “The efficiencies we gain will allow us to invest in strategic opportunities, while creating meaningful value for customers.”
44 percent of the buyout price will consist of cash, with the remainder based on Merck shares. Merck said that it is committed to keeping its dividend, which is three times as large as what current Schering-Plough holders receive.
The Merck merger comes on the heels of Pfizer’s buyout of Wyeth in January, which was valued at $68 billion. The deal has yet to be finalized.