Sanofi announces planned business swap with Boehringer Ingelheim

Sanofi has announced that it has begun negotiations over a business swap with Boehringer Ingelheim.

The proposed transaction would consist of an exchange of Sanofi's animal health business Merial and Boehringer Ingelheim's consumer healthcare business, excluding the latter's operations in China.

Merial is valued at 11.4 billion euros (8.3 billion pounds), while Boehringer Ingelheim's consumer healthcare division has an enterprise value of 6.7 billion euros. As such, the transaction will include a gross cash payment of 4.7 billion euros to account for this.

The transaction would allow Sanofi to become an industry leader in consumer healthcare, with expected pro forma sales of approximately 5.1 billion euros in 2015 and a global market share close to 4.6 percent.

Boehringer Ingelheim, meanwhile, would become the second largest player in the global animal health market.

Dr Olivier Brandicourt, chief executive officer of Sanofi, said: "This transaction would allow Sanofi to become a world leader in the attractive non-prescription medicines market and would bring a complementary portfolio with highly recognised brands, allowing for mid and long-term value creation."