Sanofi and Boehringer Ingelheim have now signed contracts to exchange their respective animal health and consumer healthcare businesses.

The strategic swap will see Boehringer's CHC business - with an enterprise value of 6.7 billion Euros - transferred to Sanofi and Sanofi's Merial - which is worth around 11.4 billion Euros - transferred to Boehringer.

The transaction includes a cash payment to Sanofi of 4.7 billion Euros to reflect the difference in value of the two businesses.

Sanofi expects the overall transaction neutral to earnings in 2017 and accretive afterwards, taking into account the expected contribution from the new CHC business, progressive implementation of synergies and the use of part of the net proceeds to buy shares back. Joint CHC sales are expected to amount to around 4.9 billion Euros, based on 2015 figures.

Combining Merial and BI's complementary portfolios and technology platforms in anti-parasitics, vaccines and pharmaceutical specialties will boost the combined company's competitiveness in key growth segments, the Germany drugmaker noted, adding that animal health sales are expected to more than double to around 3.8 billion Euros as a result.

"This is a win for Boehringer Ingelheim and Sanofi alike," and "one of the most significant steps in our corporate history," noted Andreas Barner, Boehringer's chairman of the board. The similarity in culture and approaches of the two companies "will ensure that the businesses acquired by the other partner will develop well in the future."

The move, which is expected to complete by year-end, remains subject to approval by all regulatory authorities in different territories.

The French drugs giant is also currently seeking a deal with US biotech Medivation, which sells prostate cancer drug Xtandi (enzalutamide), as chief executive Olivier Brandicourt strives to update the business model to counter dwindling sales of its flagship insulin product.