One is the milk powder giant, the other is the contraceptive giant. Now the latter does not want to control the population. I want to encourage people to have more children to drink Mead Johnson's milk powder.
On February 3, according to the Wall Street Journal, Durex's parent company, Li Jie, was discussing the merger with American infant formula company Mead Johnson. Li Jie plans to make an acquisition at a price of $90 per share for a total consideration of approximately $16.7 billion. The company intends to meet the acquisition through cash and debt financing.
A US headquarters statement sent by Mead Johnson to the International Finance News pointed out that in view of media reports and statements issued by Li Jie, Mead Johnson confirmed that Li Jie was proposed to purchase it at a price of 90 US dollars per share in cash. Mead Johnson stressed that the current agreement between the two parties has not been reached, nor does it guarantee that the negotiations between the two parties will eventually lead to any transaction.
Founded in 1823, the Li Jie Shi Group is a global company known for producing a wide range of fast moving consumer goods for health, hygiene and home care. Its current market value is 56 billion US dollars, and it owns famous brands such as Durex, Shuangjian, Dilu and Weiting.
The larger acquisition of Li Jie was the acquisition of Durex condom manufacturer SSL International in 2010, which cost about $3.2 billion. The acquisition of the US favors the case or refreshes the acquisition history, becoming the largest acquisition in the history of Li Jie.
Mead Johnson is currently the world's third-largest baby food manufacturer, with revenues mainly from Asian and American markets, behind Nestlé and Danone.
However, the reporter noted that Mead Johnson’s development in China in recent years is not ideal. In the Chinese market, Mead Johnson has dropped from the former boss to the third. An important reason is that in 2013, the National Development and Reform Commission foreign-funded enterprises initiated anti-monopoly investigations. Many milk powder enterprises were identified as having price monopolistic behaviors, and Mead Johnson also suffered heavy punishment. . Five foreign milk powder companies such as Mead Johnson, Dumex, Abbott, Fu Shilan (Mei Su Jia Er) and Fonterra were fined up to 505 million yuan for alleged commercial bribery.
Since then, Mead Johnson has become more and more conservative, and has not taken advantage of forces like Danone and Wyeth. Some analysts pointed out that after Yu Peiyu's 2013 general manager of Mead Johnson Greater China, Mead Johnson's management in China has experienced a sharp shock. Many senior executives have resigned. The news said that the sales leaders of several major districts have almost gone halfway. Among the staff, there are many old employees who have worked for Mead Johnson for more than ten years.
After 2015, Mead Johnson's performance has been declining. Net sales have fallen by 8% for two consecutive years. The Asian market has fallen by 11% and 9% respectively in the past two years.
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