Abstract

The case study ‘The P&G-Merck KGaA Consumer Health Business Merger’ discusses the M&A deal between the Germany-based global pharmaceutical company Merck KGaA and the US-based, multinational FMCG company P&G. In this deal, P&G acquired a 100% stake in the consumer health business of Merck KGaA for US$4.2 billion. The case helps the students understand the various aspects of an M&A deal. It explores the rationale behind the merger deal, from both P&G’s and Merck KGaA’s perspective. It discusses the various developments that took place before and after the merger was announced. The case provides sufficient scope to debate the various possible synergies and various challenges related to this deal. The case ends with a debate on whether the merger would be successful or not.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• To understand the various challenges related to any cross-border M&A and explore strategies to overcome those challenges
• Analyze the various motives behind acquisitions
• Understand acquisition as a growth strategy

Keywords

Cross-border M&A; Expansion Strategy, Acquisition; Growth strategy; Business Strategy Analysis; Integration challenges; Consumer Health Business; Radical changes; Bidding Process, OTC Segment; Procter & Gamble Company; Merck KGaA