Kimberly-Clark has agreed to acquire Kenvue, the maker of Tylenol and other consumer health products, for approximately $48.7 billion in a transformative deal that will create one of the world's largest consumer health companies. The announcement sent Kenvue shares soaring 18% in premarket trading Monday.
The cash and stock transaction will bring together two complementary portfolios of household brands, combining Kimberly-Clark's Kleenex tissues, Huggies diapers, Cottonelle and Scott toilet paper with Kenvue's extensive health and wellness portfolio including Tylenol, Neutrogena skincare products, Listerine mouthwash, Band-Aid bandages, Aveeno, Benadryl, and Zyrtec.
Deal Structure and Financial Impact
Under the agreement, Kimberly-Clark shareholders will own 54% of the combined company, while Kenvue shareholders will receive the remaining 46%. The deal values Kenvue at about $40 billion, with the total transaction value reaching $48.7 billion when including Kimberly-Clark shares that will go to current Kenvue holders.
The newly formed consumer health giant is expected to generate approximately $32 billion in combined annual revenues. However, Kimberly-Clark shares fell as much as 14% in premarket trading as investors digested the acquisition's impact.
Strategic Rationale
Kenvue CEO Kirk Perry emphasized that the merger would enable the company to "innovate even faster" and described the deal as uniting "two highly complementary portfolios filled with iconic, beloved brands and everyday essentials that people trust and count on throughout their lives."
Kimberly-Clark CEO Mike Hsu, who is expected to remain as CEO of the combined entity when the deal completes in the second half of next year, noted that Kenvue is "uniquely positioned at the intersection of CPG and healthcare." He added that the combined companies "will serve billions of consumers across every stage of life."
Kenvue's Recent Challenges
The acquisition comes as Kenvue has faced significant headwinds since its spinoff from Johnson & Johnson in 2023. The company's shares have declined following repeated disappointing earnings, leading to the departure of former CEO Thibaut Mongon in July.
Recent political controversy has also impacted the company, with Health Secretary Robert F. Kennedy Jr. reasserting unproven claims linking Tylenol to autism. President Donald Trump had previously urged pregnant women not to take the painkiller, making baseless claims about its safety. Kenvue has consistently noted that such claims are not supported by scientific evidence, and medical professionals have expressed alarm at these unfounded assertions.
Market Position
The deal represents a significant consolidation in the consumer health sector, bringing together brands that span multiple categories from personal care and hygiene to over-the-counter medications. The combined company will have a substantial presence across various consumer touchpoints, from infancy through adulthood, with products used in daily routines and healthcare needs.
The transaction is subject to regulatory approval and other customary closing conditions, with completion expected in the second half of 2025.
