EU Approves Merck KGaA’s Takeover of Sigma-Aldrich

Germany’s Merck KGaA has won the European Commission’s approval for its planned takeover of US life science company Sigma-Aldrich, subject to certain conditions.

The EU green light follows prior antitrust clearance in the US, Taiwan, South Africa, Russia, Serbia and Ukraine and, more recently, Japan and China.

To gain EU approval, Merck and Sigma-Aldrich have agreed to sell all of the US company’s solvents and inorganics business in Europe. The divestments will include assets in Seelze, Germany, where most of the relevant products are manufactured.

Additional divestments are to include solvents and inorganics sold by Sigma-Aldrich worldwide under the Fluka, Riedel-de-Haen and Hydranal brands, along with a temporary license to sell the products in the European Economic Area (EEA).

Related compliance conditions include the transfer of customer information and a solution to ensure a temporary channel to sell the products.

In view of the EU’s attached strings, Merck said it will work toward a mid-2015 completion of the transaction.

Other hurdles to be taken before the deal can close are the approval of the Brazilian competition authority, Council for Economic Defense (CADE), as well as the Israeli regulatory body IAA and the Korean antitrust agency.

“We will work with all related parties in the coming months to swiftly implement the commitments that have been agreed with the EU,” said Merck executive board member Bernd Reckmann.

The deal announced in September of last year foresees the Darmstadt-based chemicals and pharmaceuticals producer paying $17 billion for Sigma-Aldrich to establish what it said will be one of the leading players in the $130 billion global life science industry.

Merck said buying Sigma-Aldrich is “a key element” in its Fit for 2018 transformation program aimed at strengthening its three growth platforms of healthcare, life science and performance materials.

The addition of the Sigma-Aldrich portfolio to the products and capabilities of Merck’s US subsidiary Merck Millipore will give the expanded group a complementary range of products across laboratory chemicals, biologics and reagents.

In pharma and biopharma, the US company will extend Merck Millipore’s value chain of drug production and validation.