Morning:
8°c
Merck pays £29bn for Schering-Plough
9 Mar 2009US drugs giant Merck today bought rival Schering-Plough for $41.1 billion (£29.4 billion), in the latest megadeal to shake up the pharma sector.
Big job cuts are expected. Merck and Schering-Plough employ several thousand workers in the UK, including in Feltham, Uxbridge and Welwyn Garden City.
The deal, to be paid in shares and cash, gives Schering shareholders $23.61 a share, a 34% premium on last week's closing price. The firms sell rival cholesterol medicines Zetia and Vytorin, which have combined sales revenues of $4.5 billion.
David Moskowitz, an analyst with Cari, said Merck had won a "tremendous deal". He added: "The price seems way too low. What makes Schering so attractive is the number of drugs in their pipeline and the lack of generic competition."
The deal follows Viagra maker Pfizer's purchase of Wyeth for £50 billion in January.
