Merck: Client Knowledge is the key to reactivity
Societe Generale supported Merck, the world's oldest operating chemical and pharmaceutical company, in the 2014's largest European M&A operation.
Thanks to its long-standing relationship with Merck, Societe Generale was able to provide the German pharmaceutical and chemical company with a highly effective service for a key strategic deal: the acquisition of US company Sigma Aldrich for $17 billion. This merger and acquisition, the biggest in Europe in 2014 and the largest transaction carried out by a German company since 2009, enabled Merck to consolidate its position as one of the global leaders in its industry. Societe Generale Corporate & Investment Banking played a central role as lead underwriter, bookrunner and mandated lead arranger.
“Societe Generale was instrumental in the success of this major transaction for us.”
Societe Generale was instrumental in the success of this major transaction for us,” said Rando Bruns, Head of Treasury at Merck KGaA. “The bank delivered significant commitments at very short notice and, by driving a very tight process, guaranteed absolute confidentiality, despite the involvement of several teams.”
SG CIB was able to provide its initial financing commitment of $5.2 billion in less than 24 hours, a third of the required $15.6 billion total. The ability to provide such a quick engagement is a major strength and a result of the in-depth knowledge the bank has of its client, with whom it has a long-standing and trusted relationship. SG CIB had previously worked with Merck on major acquisitions, such as the acquisition for €10.3 billion of Swiss biotech leader Serono in 2006 and of US bioscience company Millipore for €5.1 billion in 2010.
“Our teams, experts in the sector and in ratings advisory, have maintained an ongoing dialogue with Merck, which enabled us to contribute from the outset to determining acquisition targets and discussing rating considerations,” explains Guido Zoeller, Group Country Head for Germany at Societe Generale. The overall syndication process, whereby other financing parties undertake the remaining parts of the debt, was successfully completed within just three weeks.