Merck KGaA Acquires Sigma-Aldrich, Extends Reach To N. America, Asia

Merck has acquired Sigma-Aldrich for $17 billion, extending its product line and global reach to North America and Asia. The acquisition, announced in a press release, is expected to close mid-2015. The combination of Germany’s Merck KGaA and U.S.-based Sigma-Aldrich will enable Merck to offer a wider range of complementary products, invest in R&D, and improve its e-commerce and distribution platform. Karl-Ludwig Kley, Chairman of Merck’s Executive Board, described this move as a “quantum leap.”

Merck and Sigma-Aldrich Agreement

Kley said that the two companies intend to combine their product lines and offerings in research, manufacturing, and diagnostics. The combined company will be able to offer established brands, a more efficient supply chain, and delivery of more than 300,000 products. The arrangement is expected to especially serve the North American and Asian markets. The agreement between Merck and Sigma-Aldrich calls for Merck to pay $140 per share in cash for a total of $17 billion (€13.1 billion). Merck will maintain a presence in Sigma-Aldrich’s home base of St. Louis, MO.

Sigma-Aldrich’s Role In Pharma

Sigma-Aldrich produces over 200,000 chemicals used in the life sciences and other industries. Its offerings include biochemical products, kits and services, pharmaceutical development, disease diagnostics, and high technology manufacturing. The company has over 9,000 employees in 37 countries and  three business units: Research, SAFC Commercial, and Applied.

• Research Business Unit – serves academia and government with tools to investigate disease
• SAFC Commercial Business Unit – provides high-potency drugs, small molecules, reagents, chemical precursors, and biological safety testing
• Applied Business Unit – combines the efforts and products of the Research and Commercial units to provide customers with workflow-based solutions, diagnostic testing, and raw materials

Recently, Sigma-Aldrich has made several efforts in the biotechnology sector. The company entered a partnership in September 2014 with the University of Michigan (UM) Medical School's Vector Core for gene editing to elucidate oncogene functions and drug resistance. In May 2014, it entered into a collaborative technology agreement with BioTools, a Florida-based manufacturer of advanced chiroptical spectroscopic instruments, to develop chiral structural determination tools and speed up the entrance of chiral-based drugs into the market.