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Two NJ Pharma Giants To Merge

WHITEHOUSE STATE, NJ-Another major merger between two New Jersey pharmaceutical giants is in the works, and the state's office market observers await the fallout.

By Maria Wood | Updated on March 09, 2009

WHITEHOUSE STATION, NJ-Still reeling from the late January announcement that Pfizer Inc. and Wyeth intend to merge, two more Garden State pharmaceutical giants–Merck & Co. and Schering Plough Corp.–yesterday revealed their plans to combine in a $41.1-billion deal.

Under the stock and cash transaction, Schering-Plough shareholders will receive $10.50 in cash and 0.5767 in Merck stock for each share of Schering-Plough. Merck’s total bid amounts to $23.61 a share, which represents a 34% premium over the closing price of Schering-Plough on March 6. The combined company will be known as Merck, with that company’s chairman, president, CEO Richard T. Clark leading the merged entity, which will make its headquarters here.

In a statement announcing the deal, the companies said they expect to achieve a cost savings of $3.5 billion annually after 2011. In an interview with Dow Jones Newswires, Clark said that the company expects to reduce about 15% of its combined workforce and have already instituted hiring freezes.

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