Kimberly-Clark is buying Tylenol maker Kenvue for about $48.7 billion in cash and stock, creating a major consumer health products company.
Kimberly-Clark shareholders will own approximately 54% of the combined company. Kenvue shareholders will own approximately 46%.
The combined company will have a large collection of household brands under one roof, with Kenvue's Listerine mouthwash and Band-Aid sitting alongside Kimberly-Clark's Cottonelle toilet paper, Huggies and Kleenex wipes. The company's annual revenue will also be about $32 billion.
Kenvue existed for a relatively short period of time as an independent company after being spun off Johnson and Johnson two years ago. J&J first announced in late 2021 that it division of the consumer health division from the Pharmaceuticals and Medical Devices divisions.
The deal, announced Monday, is among the biggest corporate takeovers of the year.
Kenview was thrust into the national spotlight last month when Secretary of Health Robert F. Kennedy Jr. confirmed unproven link between the painkiller Tylenol and autism, and suggested to people who opposed theory were motivated by hatred of President Donald Trump.
During a meeting with Trump and the Cabinet, Kennedy confirmed the connection, although he noted that there was no medical evidence to support the claim.
In July, Kenvue announced that CEO Thibault Mongon was care in the midst of a strategic review of the company under increasing pressure from activist investors. Board member Kirk Perry is serving as interim CEO.
“We will serve billions of consumers across all life stages,” Kimberly-Clark Chairman and CEO Mike Xu said in a statement.
Xu will become chairman and CEO of the combined company. Three Kenvue board members will join Kimberly-Clark's board of directors upon closing of the transaction. The combined company will maintain Kimberly-Clark's headquarters in Irving, Texas, and will continue to have a significant presence in Kenvue offices.
The deal is expected to close in the second half of next year. This still requires shareholder approval from both companies.
Kenvue shareholders will receive $3.50 per share in cash and 0.14625 Kimberly-Clark shares for each Kenvue share held at closing. That works out to $21.01 per share based on Kimberly-Clark's closing stock price on Friday.
Kimberly-Clark and Kenvue said they have identified approximately $1.9 billion in cost savings expected in the first three years after the deal closes.
Kimberly-Clark shares fell more than 15% before the market opened, while Kenvue shares jumped more than 20%.
Michelle Chapman, Associated Press
