Eli Lilly and Co said on Tuesday it will buy Swiss drugmaker Novartis AG’s animal health business for $5.4 billion in cash to strengthen and diversify its Elanco unit.
Lilly said it plans to fund the deal with about $3.4 billion of cash on hand and $2 billion of loans. The company did not disclose any other financial terms of the deal.
“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,” Lilly’s Chief Executive John Lechleiter said.
Lilly expects cost savings of about $200 million per year within three years of closing the deal. It also expects the purchase to add to its profit on a cash basis from 2016, excluding integration costs.
Lilly said the deal is not expected to change its dividend policy or current share repurchase program.
- Soon You Could Get Plastic Currency Notes: Find Out More
- Ranveer Singh and Vaani Kapoor Starrer Befikre Gets A Thumbs Up
- Supreme Court Seeks Centre’s Response Over Various Issues Regarding Demonetisation
- Defence Minister Manohar Parrikar Writes To West Bengal CM Mamata Banerjee
- Bigg Boss 10 December 8 Review: Swami Om Feels Cheated, lashes Out At Gaurav For Jail Punishment
- South Korean President Park Geun-Hye Impeached Over Corruption Scandal
- Former Air Chief SP Tyagi Arrested In VVIP Chopper Scam
- After Congress Vice President Rahul Gandhi, Liquor Baron Vijay Mallya’s Twitter Account Hacked
- Find Out What PM Narendra Modi Told Cabinet Over Demonetisation Decision
- Home Minister Rajnath Singh Assures Safety Of All Tourists Stranded On Havelock Island
- Government To Waive Service Tax On Debit, Credit Card Transactions Of Up To Rs 2,000
- President Pranab Mukherjee Criticises Parliament Disruptions Over Demonetisation
- Pakistan International Airlines Flight Carrying Over 40 Passenger On Board Crashes
- Shah Rukh Khan On Raees Clash With Kaabil: It’s Impossible To Have A Solo Release In India
- US-President Elect Donald Trump Named TIME’s Person Of The Year 2016
BofA Merrill Lynch is acting as financial adviser and Weil, Gotshal & Manges LLP is the legal counsel to Lilly. Goldman Sachs is acting as financial adviser to Novartis, while Freshfields Bruckhaus Deringer is its legal counsel.
Seperately, Novartis said it agreed to buy GSK’s oncology products for $14.5 billion. The deal also includes up to $1.5 billion in milestone payment. The Swiss drugmaker said it would sell its vaccines business, excluding its flu business, to GSK for $7.1 billion plus royalties.