Kimberly-Clark announced Monday that it will buy Kenvue for around $48.7 billion, uniting the Huggies diaper maker with the company behind Tylenol and Band-Aid.
Under the agreement, Kenvue investors get a mix of $3.50 cash and stock worth $21.01 total per share using Kimberly-Clark’s stock price from the end of October, according to a press release from Kimberly-Clark Corporation and Kenvue Inc. Those currently holding Kimberly-Clark shares will own about 54 percent of the merged business with Kenvue shareholders holding the rest.
“We are excited to bring together two iconic companies to create a global health and wellness leader,” Kimberly-Clark Chairman and Chief Executive Officer Mike Hsu said. “Kenvue is uniquely positioned at the intersection of CPG and healthcare, with exceptional talent and a differentiated brand offering serving attractive consumer health categories.” (RELATED: Kraft Heinz Food Corporation Will Break Up Into 2 Companies)
Kimberly-Clark agreed to buy Kenvue in a deal worth roughly $40 billion in a combination that could create a company with $32 billion in revenue.
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The merger will produce a merged company with around $32 billion in 2025 annual sales and around $7 billion in adjusted EBITDA, the press release said. Kimberly-Clark projects $2.1 billion in total run-rate synergies, including around $1.9 billion in cost cuts and around $500 million in profit from a more efficient revenue stream.
Both boards approved the transaction, which needs shareholder votes and regulatory clearance before wrapping up next year, according to The New York Times.
Kenvue shares jumped 15 percent in premarket trading while Kimberly-Clark stock dropped over 10 percent, the outlet reported. The company has struggled since Johnson & Johnson spun it off in 2023, pushing activist investor Starboard Value to call for changes.
The acquisition comes over a month after President Donald Trump said officials in his administration warned against pregnant women taking Tylenol. “Taking Tylenol is not good. For this reason they are strongly recommending women limit Tylenol use when pregnant unless medically necessary,” he said in September.