Sigma-Aldrich-Honeywell Deal Advances Merck Takeover
Sigma-Aldrich will sell parts of its solvents and inorganics business in Europe to Honeywell, to enhance its chances of winning the European Commission’s approval for its $17 billion acquisition by Germany chemicals and pharmaceuticals group Merck KGaA.
Merck said it has submitted the agreement with Honeywell to the Commission, which has already provided conditional approval for the acquisition. The German company added that it still expects to close the deal by the end of November.
The sale agreement represents “another key step toward completing the acquisition of Sigma-Aldrich,” said Merck executive member Bernd Reckmann.
Assets to be sold to Honeywell include Sigma-Aldrich’s manufacturing base and all related assets in Seelze, Germany, where most of the solvents and inorganics the company sells in Europe are produced.
Honeywell will also acquire the solvents and inorganics sold by Sigma-Aldrich in Europe under the Sigma-Aldrich brand, worldwide under the Fluka brand and associated trademarks such as Hydranal and Chromasolv and will also take a temporary license to the Sigma-Aldrich brand for the supply of solvents and inorganics in the European Economic Area.
Separately, Honeywell announced it had agreed to pay about €105 million for the assets, which Darius Adamczyk, CEO of Honeywell Performance Materials and Technologies, said will allow the company to offer a broader line of inorganic chemicals and solvents for demanding applications ranging from pharmaceutical drug discovery to medical diagnostic testing.
The businesses acquired from Sigma-Aldrich will be integrated into the Honeywell Fine Chemicals unit, which also has production facilities in Seelze, near Hanover. “The combination of Honeywell's manufacturing expertise with the strength of an expanded solvents and inorganics portfolio will enable us to better serve all of our customers in research chemicals,” Adamczyk said.