Germany’s Merck KGaA is mulling a sale of its $1 billion consumer health business as it looks to meet financial targets in the wake of a decline in its liquid crystal businesses.
Management at Merck have reportedly sounded out prospective buyers on a number of occasions over the years, but were held back by the founding family who owns 70% of Merck and favors a diversified strategy.
“We expect increasing internal constraints to fund the business to reach the required scale. Fully anticipating this, we are preparing strategic options. Any possible proceeds from a potential transaction would be used to deliver on the company’s overall financial targets,” healthcare biz CEO Belen Garijo said.
The company is reportedly considering both a full or partial sale of the consumer health business, as well as strategic partnerships. Merck said that the review process is still in an early stage, and that no final decisions have been taken.
Merck’s financial forecast foresees flat core earnings of between $5.2 and $5.5 billion (EU €4.4-4.6 billion) for 2017, with a slight to moderate organic increase in sales.
Material from Reuters was used in this report.
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