Merck & Co makes agreed $41.1B bid to acquire Schering-Plough

In a move that has been long predicted because of their close links on certain co-marketed cardiovascular products, US drug majors Merck & Co  and Schering-Plough have announced a merger, to create an enterprise  with combined pro forma 2008 turnover of around $47.0 billion. Ahead of  the news on March 9, S-P's shares had gained 8% to $17.63 on rumors that  a takeover bid was about to be revealed, though health care giant  Johnson & Johnson was also touted as the potential buyer.

Under the terms of the agreement, which is described as a "reverse  merger," S-P will be the surviving company but taking on the Merck name  and retaining the latter's chairman and chief executive, Richard Clark  as head of the combined group. S-P's CEO Fred Hassan, who was  responsible for building up troubled Pharmacia, and selling it on to  drugs behemoth Pfizer for $58.0 billion, says he is committed to staying  until the integration completes, which is expected to occur in the  fourth quarter.