Personal care multinational Kimberly-Clark has swooped to acquire consumer health company Kenvue in a deal worth almost $50bn, bringing together brands such as Huggies, Kleenex and Andrex with Johnson’s, Listerine and Neutrogena.
The takeover, unanimously approved by the boards of both US-headquartered companies, will result in the creation of a group with revenues of $32bn and combine 10 billion-dollar global brands.
Kimberly-Clark said today it had reached an agreement to buy Kenvue in a cash-and-stock deal, with the latter’s shareholders set to receive $6.8bn upfront in cash. Following completion of the deal, Kimberly-Clark shareholders will own about 54% of the combined group, while Kenvue investors will hold 46%.
The agreed price represented a 14.3x multiple of Kenvue’s adjusted EBITDA and valued the business at $48.7bn.
It makes the deal one of the biggest in the consumer space in recent years, dwarfing the $36bn merger of Mars and Kellanova in 2024.
“We are excited to bring together two iconic companies to create a global health and wellness leader,” said Kimberly-Clark CEO Mike Hsu.
“Kenvue is uniquely positioned at the intersection of CPG and healthcare, with exceptional talent and a differentiated brand offering serving attractive consumer health categories. With a shared commitment to developing science and technology to provide extraordinary care, we will serve billions of consumers across every stage of life.”
Kenvue owns dozens of recognised household brands such as Listerine, Johnson’s, Nicorette, Tylenol, Calpol, Imodium, Neutrogena, Aveeno, Benadryl and Band-Aid. The company was formed in 2022 when Johnson & Johnson spun off its consumer health division, with Kenvue valued at $41bn in its New York IPO in 2023.
Shares in Kenvue had lost about a third of their value since the float – and were well down from the 2023 high of $41 – before today’s announcement. The stock is up 18% in early trading in New York today at $17.
Kenvue chairman Larry Merlo said: “Bringing together Kenvue and Kimberly-Clark creates a uniquely positioned global leader in consumer health with a broader range of new growth opportunities ahead. We are excited about this next chapter for Kenvue and confident this combination represents the best path forward for our shareholders and all other stakeholders.”
CEO Kirk Perry added: “Our combination with Kimberly-Clark unites two highly complementary portfolios filled with iconic, beloved brands and everyday essentials that people trust and count on throughout their lives.
“Together, our combined strengths, expanded capabilities and resources, and broader reach will empower us to innovate even faster and strengthen our category leadership. We truly believe this transaction with Kimberly-Clark will bring greater value to our shareholders, create new and different potential growth opportunities for our talented employees, and deliver even more benefits to our customers and consumers.”
Total cost synergies of $1.9bn have been identified from the combination and are expected to be realised in the first three years following the closure of the deal.
Kimberly-Clark secured financing from JPMorganChase for the transaction, with the cash part of the deal to be funded from the balance sheet, new debt and the proceeds from the spin-off of its international tissue operation earlier this year.
The deal is expected to close in the second half of 2026, subject to shareholder and regulatory approvals.
Hsu, who will be CEO and chairman of the combined company, added: “Over the last several years, Kimberly-Clark has undertaken a significant transformation to pivot our portfolio to higher-growth, higher-margin businesses while rewiring our organisation to work smarter and faster.
“We have built the foundation and this transaction is a powerful next step in our journey. We look forward to working with the Kenvue team to bring these companies together, and are confident we will drive significant value for our combined shareholders.”
No comments yet