U.S. drugmakers Merck and Schering-Plough announced Monday plans to merge in a deal worth about $41 billion in stock and cash.
The two New Jersey-based companies say that Merck's top executive, Richard Clark, will lead the combined company under Merck's name.
In a statement, Merck and Schering-Plough say the new combined company will benefit from an expanded presence in international markets and a stronger research sector. The two companies already are partners in a joint venture that works on cholesterol medications.
Merck also is expected to diversify its portfolio of medicines and benefit from the worldwide reach of Schering-Plough.
Schering-Plough generates about 70 percent of its sales outside the United States, including more than $2 billion from emerging markets.
Merck also is expected to save annually $3.5 billion after 2011 due to the merger.
Under the deal, Schering-Plough shareholders will get about $10.50 in cash and a little more than half of one Merck share for each Schering-Plough share they own. This deal values Schering-Plough at $23.61 a share, representing a 34-percent premium based on Friday's closing price of the stock.