DGAP-Adhoc: Merck KGaA: Merck to Acquire Sigma-Aldrich to Enhance Position in Attractive Life Science Industry


Merck KGaA  / Key word(s): Offer

22.09.2014 11:56

Dissemination of an Ad hoc announcement according to § 15 WpHG, transmitted
by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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Merck, a leading company for innovative and top-quality high-tech products
in the pharmaceutical, chemical and life science sectors, and Sigma-Aldrich
Corporation ("Sigma-Aldrich"), today have entered into a definitive
agreement under which Merck will acquire Sigma-Aldrich for $17.0 billion
(EUR13.1 billion), establishing one of the leading players in the $130
billion global life science industry.

Merck will acquire all of the outstanding shares of Sigma-Aldrich for $140
per share in cash. The agreed price represents a 37% premium to the latest
closing price of $102.37 on September 19, 2014, and a 36% premium to the
one-month average closing price. The transaction is expected to be
immediately accretive to Merck's EPS pre and EBITDA margin. Merck expects
to achieve annual synergies of approximately EUR260 million (approximately
$340 million), which should be fully realized within three years after
closing.

Bridge financing has been secured for the all-cash transaction, and Merck
expects the final financing structure will comprise a combination of cash
on Merck's balance sheet, bank loans and bonds. Closing is expected
mid-year 2015, subject to regulatory approvals, approval by a special
meeting of the shareholders of Sigma-Aldrich and other customary closing
conditions.


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Information and Explaination of the Issuer to this News:

Cautionary Note Regarding Forward-Looking Statements

This communication may include 'forward-looking statements.' Statements
that include words such as 'anticipate,' 'expect,' 'should,' 'would,'
'intend,' 'plan,' 'project,' 'seek,' 'believe,' 'will,' and other words of
similar meaning in connection with future events or future operating or
financial performance are often used to identify forward-looking
statements. All statements in this communication, other than those relating
to historical information or current conditions, are forward-looking
statements. We intend these forward-looking statements to be covered by the
safe harbor provisions for forward-looking statements in the Private
Securities Litigation Reform Act of 1995. These forward-looking statements
are subject to a number of risks and uncertainties, many of which are
beyond control of Merck KGaA, Darmstadt, Germany, which could cause actual
results to differ materially from such statements.

Risks and uncertainties relating to the proposed transaction with
Sigma-Aldrich Corporation ('Sigma-Aldrich') include, but are not limited
to: the risk Sigma-Aldrich's shareholders do not approve the transaction;
uncertainties as to the timing of the transaction; the risk that regulatory
or other approvals required for the transaction are not obtained or are
obtained subject to conditions that are not anticipated; competitive
responses to the transaction; litigation relating to the transaction;
uncertainty of the expected financial performance of the combined company
following completion of the proposed transaction; the ability of Merck
KGaA, Darmstadt, Germany, to achieve the cost-savings and synergies
contemplated by the proposed transaction within the expected time frame;
the ability of Merck KGaA, Darmstadt, Germany, to promptly and effectively
integrate the businesses of Sigma-Aldrich and Merck KGaA, Darmstadt,
Germany; the effects of the business combination of Merck KGaA, Darmstadt,
Germany, and Sigma-Aldrich, including the combined company's future
financial condition, operating results, strategy and plans; the
implications of the proposed transaction on certain employee benefit plans
of Merck KGaA, Darmstadt, Germany, and Sigma-Aldrich; and disruption from
the proposed transaction making it more difficult to maintain relationships
with customers, employees or suppliers.

Additional risks and uncertainties include, but are not limited to: the
risks of more restrictive regulatory requirements regarding drug pricing,
reimbursement and approval; the risk of stricter regulations for the
manufacture, testing and marketing of products; the risk of destabilization
of political systems and the establishment of trade barriers; the risk of a
changing marketing environment for multiple sclerosis products in the
European Union; the risk of greater competitive pressure due to
biosimilars; the risks of research and development; the risks of
discontinuing development projects and regulatory approval of developed
medicines; the risk of a temporary ban on products/production facilities or
of non-registration of products due to non-compliance with quality
standards; the risk of an import ban on products to the United States due
to an FDA warning letter; the risks of dependency on suppliers; risks due
to product-related crime and espionage; risks in relation to the use of
financial instruments; liquidity risks; counterparty risks; market risks;
risks of impairment on balance sheet items; risks from pension obligations;
risks from product-related and patent law disputes; risks from antitrust
law proceedings; risks from drug pricing by the divested Generics Group;
risks in human resources; risks from e-crime and cyber attacks; risks due
to failure of business-critical information technology applications or to
failure of data center capacity; environmental and safety risks;
unanticipated contract or regulatory issues; a potential downgrade in the
rating of the indebtedness of Merck KGaA, Darmstadt, Germany, or
Sigma-Aldrich; downward pressure on the common stock price of Merck KGaA,
Darmstadt, Germany, or Sigma-Aldrich and its impact on goodwill impairment
evaluations; the impact of future regulatory or legislative actions; and
the risks and uncertainties detailed by Sigma-Aldrich with respect to its
business as described in its reports and documents filed with the U.S.
Securities and Exchange Commission (the 'SEC').

The foregoing review of important factors should not be construed as
exhaustive and should be read in conjunction with the other cautionary
statements that are included elsewhere, including the Report on Risks and
Opportunities Section of the most recent annual report and quarterly report
of Merck KGaA, Darmstadt, Germany, and the Risk Factors section of
Sigma-Aldrich's most recent reports on Form 10-K and Form 10-Q. Any
forward-looking statements made in this communication are qualified in
their entirety by these cautionary statements, and there can be no
assurance that the actual results or developments anticipated by us will be
realized or, even if substantially realized, that they will have the
expected consequences to, or effects on, us or our business or operations.
Except to the extent required by applicable law, we undertake no obligation
to update publicly or revise any forward-looking statement, whether as a
result of new information, future developments or otherwise.

Important Additional Information

This communication is being made in respect of the proposed merger
transaction involving Sigma-Aldrich and Merck KGaA, Darmstadt, Germany. The
proposed merger will be submitted to the stockholders of Sigma-Aldrich for
their consideration. In connection therewith, Sigma-Aldrich intends to file
relevant materials with the SEC, including a preliminary proxy statement
and a definitive proxy statement. The definitive proxy statement will be
mailed to the stockholders of Sigma-Aldrich. BEFORE MAKING ANY VOTING OR
ANY INVESTMENT DECISION, INVESTORS AND SECURITY HOLDERS ARE URGED TO READ
THE DEFINITIVE PROXY STATEMENT REGARDING THE PROPOSED TRANSACTION AND ANY
OTHER RELEVANT DOCUMENTS FILED OR TO BE FILED WITH THE SEC CAREFULLY AND IN
THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors and
security holders may obtain free copies of the proxy statement, any
amendments or supplements thereto and other documents containing important
information about Sigma-Aldrich, once such documents are filed with the
SEC, through the website maintained by the SEC at www.sec.gov. Copies of
the documents filed with the SEC by Sigma-Aldrich will be available free of
charge on Sigma-Aldrich's website at www.sigmaaldrich.com under the heading
'SEC Documents' within the 'Investor Info' section in the 'Investors'
portion of Sigma-Aldrich's website. Shareholders of Sigma-Aldrich may also
obtain a free copy of the definitive proxy statement by contacting
Sigma-Aldrich's Investor Relations Department at (314) 898-4643.

Sigma-Aldrich and certain of its directors, executive officers and other
members of management and employees may be deemed to be participants in the
solicitation of proxies in connection with the proposed transaction.
Information about the directors and executive officers of Sigma-Aldrich is
set forth in its proxy statement for its 2014 annual meeting of
stockholders, which was filed with the SEC on March 21, 2014, its annual
report on Form 10-K for the fiscal year ended December 31, 2013, which was
filed with the SEC on February 6, 2014, and in subsequent documents filed
with the SEC, each of which can be obtained free of charge from the sources
indicated above. Other information regarding the participants in the proxy
solicitation of the stockholders of Sigma-Aldrich and a description of
their direct and indirect interests, by security holdings or otherwise,
will be contained in the preliminary and definitive proxy statements and
other relevant materials to be filed with the SEC when they become
available.

22.09.2014 The DGAP Distribution Services include Regulatory Announcements,
Financial/Corporate News and Press Releases.
Media archive at www.dgap-medientreff.de and www.dgap.de

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Language:     English
Company:      Merck KGaA
              Frankfurter Str. 250
              64293 Darmstadt
              Germany
Phone:        +49 (0)6151 72 - 3321
Fax:          +49 (0)6151 72 - 913321
E-mail:       investor.relations@merckgroup.com
Internet:     www.merck.de
ISIN:         DE0006599905
WKN:          659990
Indices:      DAX
Listed:       Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr
              in Berlin, Düsseldorf, Hamburg, Hannover, München, Stuttgart;
              Terminbörse EUREX; London, SIX
 
End of Announcement                             DGAP News-Service
 
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