Dutch publishing and market research company, VNU, is to buy healthcare data provider, IMS Health, in a €5.8 billion-euro ($7 billion-dollar) cash and share deal.
The move further strengthens VNU’s position in the lucrative US market – around 60% of IMS’ revenues come from this market – and adds an important healthcare arm to VNU’s burgeoning business.
Under the terms of the agreement, IMS shareholders will receive $11.25 in cash and 0.60415 VNU shares for each IMS share – representing a 16% premium over the firm’s average IMS share price over the last 30 days. VNU shareholders will hold around 65% of the combined company, and IMS shareholders approximately 35%. The merger is expected to close in the first quarter of 2006, but is subject to approval from both sets of shareholders and regulatory clearance.
The merged entity will be a world leader in three major industries – consumer packaged goods, healthcare, and media and entertainment – and will have combined pro forma 2004 revenues of around €4.7 billion, the Dutch firm said in a statement.
“This merger of two industry leaders gives us the scale and capabilities to meet growing client demand for the must-have market intelligence that drives critical business decisions,” said VNU’s chief executive officer, Rob van den Bergh, who will also be CEO of the combined company. “Together, we will be able to measure our clients’ performance in three key sectors of the global economy – consumer packaged goods, healthcare and media – and offer superior insights into the consumer behavior that drives these markets.”
“This is a strategically compelling transaction that provides real value to clients, employees and shareholders in both the near- and long-term, as well as exciting opportunities for growth,” said David Carlucci, IMS’ president and CEO who will be the merged firm’s deputy CEO and chief operating officer.