Germany's Merck KGaA has agreed to buy AZ Electronic Materials SA for about GBP1.6 billion (USD2.6 billion) in cash. The deal will give Merck access to specialty chemicals used in the production of microchips as well as flat-panel devices.
Bloomberg, citing a statement by Merck, said that AZ stockholders will receive GBX403.5 for each share. The price is 53% above the closing level yesterday in London trading. The report said that the takeover deal is still subject to the approval of antitrust authorities and a minimum acceptance of 95% of the shares.
AZ generated revenue of USD794 million last year. That means pharmaceuticals will account for more than half of Merck's sales even after the purchase, Bloomberg said.
Meanwhile, Merck had EUR6.5 billion (USD8.9 billion) in revenue last year from pharmaceuticals and EUR4.3 billion from chemicals and lab equipment, the report said.
Merck has been expanding outside of drugs as the company struggled to develop new medicines. It acquired biotechnology equipment supplier Millipore for about USD6 billion in 2010, said Bloomberg.
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