Merck KGaA CEO Eyes Interesting Takeover Targets

Published: Aug 14, 2014

Merck KGaA CEO Eyes Interesting Takeover Targets Merck KGaA CEO Eyes Interesting Takeover Targets

August 13, 2014
By Krystle Vermes, Breaking News Staff

Karl-Ludwig Kley of Merck KGaA, a German-based pharmaceutical company, told reporters on a conference call on Aug. 12 that he has been reviewing “takeover” targets, but he is not rushing to make a move in the near future, according to Reuters.

"We have a strong balance sheet and a strong cash flow,” Kley, CEO of Merck, told the news source. “We can but we don't have to pursue acquisitions.”

Kley went onto say that new deals could strengthen certain divisions of the company, but they would need to make strategic sense.

Merck KGaA is the largest maker of liquid crystals for display screens in the world. However, it does much of its business in the chemical and pharmaceutical industries in more than 66 countries.

At the end of the second quarter, Merck reported that its earnings had grown 1.2 percent from the year-ago period. Revenues for the quarter declined 1 percent to $10.9 billion. However, this beat out the $10.7 billion prediction for the company.

Merck’s Move to China
As Merck KGaA looks to expand into new markets, it’s revealing more of its plan to move into China. In July, the executive board of Merck KGaA traveled to Shanghai, China, to commemorate the development of a new pharmaceutical plant. Located in Nantong, the plant will become the group’s second-largest pharmaceutical manufacturing facility come 2017.

“China is of strategic importance to us,” said Kley. “Together with government officials, customers, partners and our highly motivated local colleagues, we will explore ways to further address critical health care needs of the Chinese population – both with our high-quality drugs and our life science tools for biopharmaceutical research and development.”

Merck KGaA noted that it counts on an extensive network of collaborations with medical and academic institutions for success. However, acquisitions abroad may help it establish a worldwide presence as well.

Exploring Other Industries
On June 30, Merck KGaA acquired Peer+, a Dutch liquid crystal window specialist. Together, the two aim to make a splash in the smart window market with windows that switch from light to dark in seconds.

“We see ourselves as an advisor and technology supplier for the industry,” said Walter Galinat, Head of the Performance Materials division at Merck KGaA. “We aim to become the leading supplier for liquid crystal materials for the production of smart windows.”

Now that Merck KGaA has made a big move in this industry, perhaps it is positioning itself to take another look at pharmaceutical or life sciences.

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