This article first appeared on: Expert Focus.
Kimberly-Clark (NASDAQ:KMB) A big bet is being made, but investors aren’t sure what to think about it..
The maker of Kleenex and Huggies said Monday it plans to acquire Tylenol maker Kenvue (KVUE) in a massive cash-and-stock deal worth nearly $48.7 billion. The news sent Kimberly-Clark shares down more than 15% in premarket trading, while Kenvue’s shares soared more than 22%.
The deal, which was approved by both companies’ boards of directors, gave Kenvue shareholders $3.50 in cash and 0.14625 shares of Kimberly-Clark stock in a deal valued at approximately $21.01 per Kenvue share. If all goes well, the combined company will generate approximately $32 billion in annual revenue by 2025, with adjusted EBITDA of $7 billion.
Kimberly-Clark CEO Mike Hsu, who will lead the new entity, said it was a rare opportunity to unite two family icons into one global health and wellness leader. Kenvue, spun off from Johnson & Johnson (JNJ) last year, owns brands such as Neutrogena, Band-Aid, and Listerine.
