RB picks up latest 'Powerbrand' with Mead Johnson acquisition

GLENVIEW, Ill. — Reckitt Benckiser on Friday announced its acquisition of Mead Johnson in a deal valued at approximately $17.9 billion.

"The acquisition of Mead Johnson is a significant step forward in RB's journey as a leader in consumer health," stated Rakesh Kapoor, RB CEO. "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," he said. "This is a natural extension of RB's consumer health portfolio of 'Powerbrands.'"

"As part of Reckitt Benckiser, a bigger health care focused business recognized for its marketing capabilities, we will derive benefits from both increased scale and diversification," noted Kasper Jakobsen, Mead Johnson CEO. "We are pleased that our shareholders have an opportunity to recognize significant and immediate value and are excited for the new opportunities for our employees as part of a larger company."

According to RB's presentation outlining the deal, seven of the company's "Powerbrands" now focus on healthier lives, the company noted.

The move certainly rounds out RB's appeal to mom at the start of her journey. RB already reaches millions of mothers through its hygiene education programs centered on the venerable brand Lysol, the company noted, and its relationship with mom is further secured through brands like Mucinex to help relieve their children when they're sick. "This will be enhanced by Mead Johnson's deep understanding of a new mother's journey and well established relationships with healthcare professionals," RB added.

Mead Johnson is already a leader in the global infant and children's nutrition category, estimated to be worth upwards of $46 billion, RB  noted. And it's a high-growth category that's expected to continue on an upward trajectory of between 3% and 5%.

Mead Johnson's infant and children's nutrition business increases RB's revenues in consumer health by approximately 90%, while its global Enfa Franchise, which includes Enfamil, becomes RB's largest "Powerbrand."

Because of its size, the proposed acquistion requires the approval of RB's shareholders. RB will soon send a circular outlining the proposed acuisition to its shareholders and setting a date to approve the acquisition. The RB board is unanimous in recommending the deal to its shareholders, the company noted.

The acquisition is also subject to approval by shareholders of Mead Johnson, regulatory approvals (including in the U.S., China and other markets) and certain other customer conditions.

The transaction is expected to be completed by the third quarter of 2017.