Merck Details Sigma Synergies
Merck Life Science would account for 35% of total Merck adjusted EBITDA, including Sigma-Aldrich’s 2014 results and expected synergies, except for Corporate and Other synergies. Merck also confirmed integration costs of €400 million ($440 million) over four years.
Darmstadt, Germany 12/10/15—At its 2015 Capital Market Day, Merck KGaA provided details about its merger with Sigma-Aldrich (see IBO 11/30/15) and how it plans to realize the €260 million ($286 million = €0.91 = $1) in synergies by 2018. Merck Life Science now consists of Research Solutions, representing 35% of revenues; Process Solutions, which make up 35%; and Applied Solutions, which account for 30%. As for synergies, the firm stated that Production and Manufacturing would account for 40% of cost savings, Administration and R&D would account for 30%, and Marketing and Selling would also account for 30%. In 2016, €90 million ($99 million) in cost savings will be realized and, in 2017, cost savings will total €170 million ($187 million). The company also expects Life Science’s adjusted EBITDA margin to rise from around 28% to around 33% following the synergies.
