Merck Places U.S. Bond Amounting to US$ 4.0 Billion

   ·  Placement is an important element of the financing of the proposed acquisition of Sigma-Aldrich

   ·  Five tranches with maturities between 2 and 10 years placed

   ·  Conservative financial policy meets with great interest also outside Europe

 

Darmstadt, Germany, March 17, 2015 – Merck, a leading company for innovative and top-quality high-tech products in healthcare, life science and performance materials, successfully placed a U.S. bond via its U.S. subsidiary EMD Finance LLC. The oversubscribed placement is an important element of the financing of the proposed acquisition of the life science company Sigma-Aldrich, which Merck announced in September 2014.

A total of five tranches were placed, comprising floating rate and fixed rate notes. The floating rate notes have a maturity of 2 years (US$ 250 million with a 0.35% spread over 3-month U.S. dollar LIBOR). The fixed rate notes have a maturity of 3 years (US$ 400 million with a coupon of 1.70%), 5 years (US$ 750 million with a coupon of 2.40%), 7 years (US$ 1.0 billion for 2.95%), and 10 years (US$ 1.6 billion for 3.25%).

 

“This first U.S. bond in Merck’s history shows that with our conservative financial policy, Merck is an attractive name for investors also outside Europe. In addition, the bond is an extremely important element of the financing of the proposed acquisition of Sigma-Aldrich. The strong resonance is very encouraging and is enabling us to further diversify our investor base,” said Marcus Kuhnert, Chief Financial Officer of Merck.

 

The bond achieved a well-diversified distribution among a wide range of institutional investors such as fund managers, insurance companies, pension funds, and banks. Bookrunners of the transaction were Merck’s relationship banks.

 

In December 2014, Merck had already successfully issued a euro hybrid bond amounting to € 1.5 billion. Merck is rated A flat (negative outlook) by Standard & Poor’s and Baa1 (negative outlook) by Moody’s.

 

The proposed acquisition of the laboratory supplier Sigma-Aldrich for US$ 17 billion is part of the “Fit for 2018” transformation and growth program, which aims to sustainably strengthen the company’s three growth platforms – Healthcare, Life Science and Performance Materials. Merck continues to expect the transaction to close in mid-2015.

 

# # #

 

Merck is a leading company for innovative and top-quality high-tech products in healthcare, life science and performance materials. The company comprises six businesses – Merck Serono, Consumer Health, Allergopharma, Biosimilars, Merck Millipore and Performance Materials – and generated sales of € 11.3 billion in 2014. Around 39,000 Merck employees work in 66 countries to improve the quality of life for patients, to foster the success of customers and to help meet global challenges. Merck is the world’s oldest pharmaceutical and chemical company – since 1668, the company has stood for innovation, business success and responsible entrepreneurship. Holding an approximately 70% interest, the founding family remains the majority owner of the company to this day. Merck, Darmstadt, Germany holds the global rights to the Merck name and brand. The only exceptions are Canada and the United States, where the company operates under EMD Serono, EMD Millipore and EMD Performance Materials.