Kimberly-Clark completes nearly $49bn acquisition of Kenvue — CNBC

In the United States, Kimberly-Clark has completed its acquisition of Kenvue, the maker of Tylenol and owner of the Band-Aid, Zyrtec, Neutrogena and Listerine brands. The value of the deal, including debt, is nearly $49 billion. This was reported by CNBC.

Financial goals of the deal

Kimberly-Clark confirmed its financial targets following the takeover: over three years, the company expects to cut costs by $1.9 billion. It also expects $500 million in additional profit from revenue growth, partly offset by $300 million in reinvestments.

Kimberly-Clark CEO Michael Hsu said the company has stronger capabilities in working with retailers, digital sales, advertising and product innovation. According to him, combining these resources should accelerate the growth of Kenvue, which was previously a division of Johnson & Johnson and became an independent company in May 2023.

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Hsu also pointed to opportunities for expansion in Kenvue's existing categories. In addition to Tylenol, the company's portfolio includes such brands as Band-Aid, Zyrtec, Neutrogena and Listerine.

Tylenol lawsuits and debt

Along with Kenvue, Kimberly-Clark is acquiring legal and reputational risks related to Tylenol. In July, a federal appeals court reinstated more than 500 lawsuits in which plaintiffs alleged that use of the drug during pregnancy may have contributed to autism or ADHD in children. Kenvue appealed the ruling, but the U.S. appeals court later declined to reconsider it.

Hsu said Kimberly-Clark conducted extensive research and consulted medical and legal specialists while preparing the deal. According to him, the company intends to maintain dividend payments and expects, from the second year after the deal's completion, to increase profit and reduce its debt leverage ratio to approximately 2.0.