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Eli Lilly and Company, which owns Elanco Animal Health, has announced an agreement to acquire Novartis Animal Health for approximately $5.4 billion in cash.
Lilly says that on completion of the deal, Elanco will be the second-largest animal health company in terms of global revenue. It will also solidify its number two ranking in the U.S., and improve its position in Europe and the rest of the world.
As part of the agreement, Lilly will acquire Novartis Animal Health's nine manufacturing sites, six dedicated research and development facilities, a global commercial infrastructure with a portfolio of approximately 600 products, a pipeline with more than 40 projects in development, and an experienced team of more than 3,000 employees.
The transaction is expected to be completed by the end of the first quarter of 2015, subject to clearance under the U.S. Hart-Scott-Rodino Antitrust Improvements Act, similar requirements outside the U.S., and other customary closing conditions.
John C. Lechleiter, Ph.D., Lilly's chairman, president and chief executive officer said: "Animal health continues to represent an attractive growth opportunity for Lilly. We intend to keep Elanco and to take advantage of the substantial synergies between our animal health and human health businesses.
"Significant investments in our animal health business in recent years have enabled Elanco to double its revenue since 2008, leading the industry in growth. Global trends suggest continued sustained demand for animal health products in the years ahead. Through this acquisition, which moves Elanco to top-tier in the industry, we intend to create value for our shareholders by adding to our promising pipeline of innovative animal health assets, increasing sales through a larger commercial footprint, and improving efficiencies and lowering costs."