It has recently been announced that European healthcare company Merck KGaA is looking to sell its consumer healthcare operations, or look at alternatives in which to develop further partnerships to provide the potential for further growth opportunities.
It’s long history, established back in the 17th century has seen it become one of the most well renowned consumer healthcare businesses in the world. The announcement has seen Merck’s shares soar by up to six percent.
A potential sell would enable Merck to further support its ongoing research into the development of new and existing prescription drugs within its biopharma channels to ensure it remains competitive throughout its strategic operations. To do so, further financial investment remains essential.
The company’s consumer healthcare provides sales of approximately $1BN per annum, making a potential sell a lucrative prospect for competitors.
However, Belén Garijo, Member of the Executive Board of Merck KGaA, Darmstadt, Germany and CEO Healthcare commented in a press release: “We have maintained a solid position in attractive markets, and demonstrated a pattern of profitable growth.
We expect increasing internal constraints to fund the business to reach the required scale. Fully anticipating this, we are preparing strategic options.”
Merck currently focuses on consumer-centric solutions driven by global megatrends and achieved net sales of €860 million in 2016, cementing its position in new and emerging markets. However, its liquid crystals business is in decline, leading the company to look at further methods in which to remain competitive.
Additionally, whilst the company is looking to sell its consumer healthcare business, it has also recently acquired healthcare company Rigontec. Merck will provide a cash agreement of €115MN to Rigontec’s shareholders, and make additional contingent payments of up to €349MN.