Kenvue to be acquired by Kimberly-Clark Corporation (KMB) in cash/stock deal; KVUE beats by $0.02, misses on revs; reaffirms FY25 EPS guidance (14.37)
- Kimberly-Clark Corporation (KMB) and Kenvue (KVUE) announced an agreement under which Kimberly-Clark will acquire all of the outstanding shares of Kenvue common stock in a cash and stock transaction that values Kenvue at an enterprise value of approximately $48.7 billion, based on the closing price of Kimberly-Clark common stock on October 31, 2025.
- Under the terms of the agreement, which has been unanimously approved by each company's Board of Directors, Kenvue shareholders will receive $3.50 per share in cash as well as 0.14625 Kimberly-Clark shares for each Kenvue share held at closing, for a total consideration to Kenvue shareholders of $21.01 per share, based on the closing price of Kimberly-Clark shares as of October 31, 2025. Upon closing of the transaction, current Kimberly-Clark shareholders are expected to own approximately 54% and current Kenvue shareholders are expected to own approximately 46% of the combined company on a fully diluted basis.
- Total anticipated run-rate synergies of $2.1 Billion; expected to be accretive to KMB"s adjusted EPS by year 2.
- Attractive financial profile. Based on current projections, the combined company would generate 2025 annual net revenues of approximately $32 billion and approximately $7 billion of adjusted EBITDA. Strong execution and synergy realization will position the combined company to achieve an industry-leading growth and financial profile. Kimberly-Clark is committed to maintaining a robust credit profile consistent with its current rating, with significant financial flexibility to drive strategic capital investment for long-term growth.
- Clear path to strong cost and revenue synergies. Kimberly-Clark and Kenvue have identified approximately $1.9 billion in cost synergies and approximately $500 million in incremental profit from revenue synergies, partially offset by reinvestment of approximately $300 million. The cost synergies are expected to be captured in the first three years following closing, and the revenue synergies are expected to be captured within four years post close. Kimberly-Clark expects $2.5 billion of cash costs to achieve these synergies, invested within the first two years post close.
- Compelling value creation for all shareholders. The transaction is expected to deliver immediate value creation to Kenvue shareholders from $6.8 billion in upfront cash consideration. The enhanced financial profile of the pro forma company is expected to deliver compelling value to all shareholders. The total consideration represents an acquisition multiple of approximately 14.3x Kenvue's LTM adjusted EBITDA2 or 8.8x including expected run-rate synergies of $2.1 billion, net of reinvestment.
- As part of the transaction, Kimberly-Clark has received committed financing from JPMorgan Chase Bank, N.A. and intends to fund the cash component of the transaction consideration through a combination of cash from its balance sheet, proceeds from new debt issuance, and proceeds from the previously announced sale of a 51% interest in its International Family Care and Professional ("IFP") business.
- The transaction is expected to close in the second half of 2026, subject to the receipt of Kenvue and Kimberly-Clark shareholder approvals, regulatory approvals and satisfaction of other customary closing conditions. As part of Kimberly-Clark's evaluation of this transaction, the Company carefully considered all risks and opportunities, working with some of the world's foremost scientific, regulatory, legal and other experts.
- KVUE Reports Q3 (Sep) earnings of $0.28 per share, excluding non-recurring items, $0.02 better than the FactSet Consensus of $0.26; revenues fell 3.5% year/year to $3.76 bln vs the $3.82 bln FactSet Consensus.
- KVUE reaffirms guidance for FY25, sees EPS of $1.00-1.05, excluding non-recurring items, vs. $1.03 FactSet Consensus. KVUE Net sales and Organic sales are expected to be down low-single-digits, assuming approximately neutral impact from foreign currency translation. Adjusted operating income margin is expected to decline year-over-year.