Reckitt Benckiser to acquire Mead Johnson Nutrition

Global consumer health and hygiene company Reckitt Benckiser (RB) has agreed to acquire pediatric nutrition producer Mead Johnson Nutrition (MJN).

According to the deal, RB has agreed to pay $90 cash for each share of Mead Johnson common stock in a transaction valued at approximately $17.9bn (including net debt).

RB chief executive officer Rakesh Kapoor said: “Mead Johnson’s geographic footprint significantly strengthens our position in developing markets, which account for approximately 40% of the combined group’s sales, with China becoming our second largest ‘Powermarket’.

“We are confident that our deep understanding of consumer needs and our expertise in scaling global brands will deliver significant growth for the MJN portfolio.

“We will draw on the best of both businesses and continue to build on Mead Johnson’s extensive R&D, regulatory, quality and specialist distribution capabilities.”

The transaction was unanimously approved by the MJN board of directors. MJN further added that it will continue to pay its normal quarterly dividend until the transaction is closed.

The completion of the transaction is subject to customary conditions, including approval by shareholders of both MJN and RB and regulatory approvals, which is expected to take place in the third quarter of this year.

As a result of this transaction, MJN will become a new division of RB.

MJN chief executive officer Kasper Jakobsen said: “This transaction recognises the value of our leading brands and strong, global organisation.

“As part of Reckitt Benckiser, a bigger health care focused business recognised for its marketing capabilities, we will derive benefits from both increased scale and diversification."