Reckitt Benckiser to buy Mead Johnson Nutrition

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LONDON — Reckitt Benckiser Group plc plans to acquire Mead Johnson Nutrition Co., a leading maker of pediatric nutrition products, for $16.6 billion.

The companies said Friday that under the agreement, Mead Johnson will become a new division of Reckitt Benckiser (RB), with its global Enfamil and Nutramigen infant and children’s nutrition brands joining RB’s broad portfolio of consumer health brands.

On Feb. 1, following media reports and an ensuing statement from RB, Mead Johnson confirmed that it was in talks about a potential acquisition agreement.

“The acquisition of Mead Johnson is a significant step forward in RB’s journey as a leader in consumer health. With the Enfa family of brands, the world’s leading franchise in infant and children’s nutrition, we will provide families with vital nutritional support,” RB chief executive officer Rakesh Kapoor said in a statement. “This is a natural extension to RB’s consumer health portfolio of power brands, which are already trusted by millions of mothers, reinforcing the importance of health and hygiene for their families.”

Besides the Enfa and Nutramigen products, Mead Johnson’s nutrition brands include Choco Milk, Lactum and Sustagen. The company develops, manufactures, markets and distributes more than 70 products in over 50 markets worldwide.

“Mead Johnson’s geographic footprint significantly strengthens our position in developing markets, which will account for approximately 40% of the combined group’s sales, with China becoming our second-largest power market,” Kapoor added. “We are confident that our culture of consumer-centric innovation and our expertise in scaling global brands will deliver significant growth for the Mead Johnson portfolio. We will draw on the best of both businesses and continue to build on Mead Johnson’s extensive R&D, quality, regulatory and specialist distribution capabilities.”

Including net debt, the acquisition has a total value of about $17.9 billion. RB has agreed to pay $90 cash for each share of Mead Johnson common stock, a premium of 29% to Mead Johnson’s closing share price on Feb. 1, prior to market speculation of a potential transaction, the companies said.

The agreement has been unanimously approved by Mead Johnson’s board of directors. The companies said they expect the transaction to be completed in the third quarter, pending Mead Johnson and RB shareholder approvals, regulatory approvals and other customary closing conditions.

“This transaction recognizes the value of our leading brands and strong, global organization,” stated Kasper Jakobsen, CEO of Mead Johnson Nutrition. “As part of Reckitt Benckiser, a bigger health care-focused business recognized for its marketing capabilities, we will derive benefits from both increased scale and diversification.”

RB’s roster of consumer health, hygiene and home product brands includes Nurofen, Strepsils, Gaviscon, Mucinex, Durex, Scholl, Clearasil, Lysol, Dettol, Veet, Harpic, Cillit Bang, Mortein, Finish, Vanish, Calgon, Air Wick, Woolite and French’s. The company has operations in more than 60 countries, with headquarters in London, Dubai and Amsterdam.



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