Kimberly-Clark, the maker of Kleenex, Huggies and Cottonelle, dropped a bombshell on Monday morning, announcing it will buy Kenvue, the maker of Tylenol, for nearly $50 billion. It will mark one of the biggest business takeovers this year, as their combined portfolios of products include $10 billion brands.
Kenvue shares shot up by about 17% in early trading. Kimberly-Clark was down about 12% by mid-morning.
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Financial details
Kenvue says the cash-and-stock deal has a total value of more than $48 billion. It spun off from Johnson & Johnson in 2023, and its share value has fallen by almost 35% since then, CNBC reports.
Kimberly-Clark is known for its household brands, including Huggies diapers, Cottonelle, Scott toilet paper and Viva paper towels, among others. It will now add Kenvue staples, including Tylenol, Band-Aid, Listerine and Neutrogena, to its portfolio.
In a release, Kimberly-Clark said the combined company is projected to generate net revenues of $32 billion in 2025.
”We are excited to bring together two iconic companies to create a global health and wellness leader,” said Mike Hsu, Kimberly-Clark’s chairman and chief executive officer.
Kenvue offers an array of brands, “serving attractive consumer health categories,” he said. “With a shared commitment to developing science and technology to provide extraordinary care, we will serve billions of consumers across every stage of life.”
Kenvue’s board chairman, Larry Merlo, also praised the deal.
“We are pleased to have reached this agreement with Kimberly-Clark that delivers significant upfront value for our shareholders and substantial upside potential through ownership in the combined company,” Merlo said. “Bringing together Kenvue and Kimberly-Clark creates a uniquely positioned global leader in consumer health with a broader range of new growth opportunities ahead. We are excited about this next chapter for Kenvue and confident this combination represents the best path forward for our shareholders and all other stakeholders.”
Kenvue, Tylenol and Trump assertions
Kenvue has been in the spotlight since President Donald Trump recently urged pregnant women not to take Tylenol, insisting that its active ingredient, acetaminophen, can potentially lead to autism in children.
Texas Attorney General Ken Paxton, R, sued Kenvue and Johnson & Johnson last week, claiming they disregarded evidence of a link between Tylenol use and autism.
Kenvue has denied those claims, saying they are “unsupported by the scientific evidence” and insisting that Tylenol is safe.
The company also cited medical experts who say Tylenol is one of the safest options to deal with pain and relief from a fever for pregnant women.
In addition, the chief science officer of the Autism Science Foundation said that “any association between acetaminophen and autism is based on limited, conflict and inconsistent science and is premature.”
Kimberly-Clark has also faced recent economic headwinds as well, in the form of tariffs, shifting consumer demands and increased costs for key ingredients and commodities.
Hsu says the company has been focusing on higher-growth and higher-margin businesses, culminating in this mega deal.
“We look forward to working with the Kenvue team to bring these companies together,” he said, “and are confident that we will drive significant value for our combined shareholders.”
