Sanofi-aventis and Merck & Co., Inc. announced today that Sanofi-aventis has exercised its option to combine Merial with Intervet/Schering-Plough, Merck's Animal Health business.

The new joint venture will be equally-owned by Merck and Sanofi-aventis. The formation of this new joint venture is subject to execution of final agreements, antitrust review in the United States, Europe and other countries, and other customary closing conditions. The completion of the transaction is expected to occur in approximately the next 12 months.

Richard T. Clark, Merck Chairman, President and Chief Executive Officer said: "Merck has been in the animal health business for well over six decades and through this new joint venture, we will bolster our diverse portfolio and create a new global competitor poised for growth.

"This new joint venture delivers on Merck's commitment to customer focus by creating one of the broadest portfolios of animal health products and services in pharmaceuticals and biologics for millions of customers who include farmers, veterinarians and pet owners. The planned joint venture will have an attractive geographical network of global technology and  expertise to provide health solutions based on customers' needs, which often vary regionally."

The worldwide animal health market reached $19 billion in 2008. Products for companion animals accounted for 40 percent of total sales while products for production animals accounted for the remaining 60 percent of total sales. This market is expected to grow at around 5 percent per year over the next 5 years, driven by a growing demand for animal proteins, as well as a strong consumer needs for companion animal health care.

The companies said that both Merial and Intervet/Schering-Plough will continue to operate independently until the closing of the transaction.

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