Reckitt signs merger agreement with Mead Johnson Nutrition Company

British multinational consumer goods company, Reckitt Benckiser Group has signed a merger agreement with a major manufacturer of infant formula, Mead Johnson Nutrition Company (NYSE: MJN)under which Mead Johnson shareholders will obtain $90 in cash for each share of common stock, valuing the overall equity at $16.6 billion. According to the agreement, the acquisition of Mead Johnson is aligned with RB’s well established strategic focus on growing in consumer health and on investing in Powerbrands with attractive growth prospects. RB already reaches millions of mothers through its hygiene education programmes and, through world class brands such as Nurofen and Mucinex, provides parents with relief and reassurance when their children are unwell. This will be enhanced by Mead Johnson’s deep understanding of a new mother’s journey and well established relationships with healthcare professionals.

Rakesh Kapoor, Chief Executive Officer of Reckitt Benckiser, commented:

“The acquisition of Mead Johnson is a significant step forward in RB’s journey as a leader in consumer health. With the Enfa family of brands, the world’s leading franchise in infant and children’s nutrition, we will provide families with vital nutritional support. This is a natural extension to RB’s consumer health portfolio of Powerbrands which are already trusted by millions of mothers, reinforcing the importance of health and hygiene for their families.

Mead Johnson’s geographic footprint significantly strengthens our position in developing markets, which will account for approximately 40% of the combined group’s sales, with China becoming our second largest Powermarket.

We are confident that our culture of consumer centric innovation and our expertise in scaling global brands will deliver significant growth for the Mead Johnson portfolio. We will draw on the best of both businesses and continue to build on Mead Johnson’s extensive R&D, quality, regulatory and specialist distribution capabilities.

For investors, we have delivered total shareholder return of over 150% over the past 5 years. I am confident that, with the addition of the Enfa franchise as the largest Powerbrand in our portfolio, we will continue to deliver for shareholders and on our strategy to make a difference by giving people innovative solutions for healthier lives and happier homes.”

James Cornelius, Mead Johnson Nutrition Chairman of the Board, commented:

“The agreement being announced today is about value creation. First and foremost, this transaction provides tremendous value to Mead Johnson Nutrition stockholders. Additionally, relative to the future growth and development of the Mead Johnson business, Reckitt Benckiser – with its strong financial base, broad global footprint, consumer branding expertise and dynamic business model – is an ideal partner.

I have been part of the journey of Mead Johnson Nutrition from its days as an operating division of Bristol-Myers Squibb through the past eight years as an independent public company and now into this powerful new business combination. I fully expect Mead Johnson to flourish as an important new part of the RB organisation.

For all of these reasons and more, this transaction has my full support and endorsement, as well as that of my fellow Board Members.”

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