Sanofi and Boehringer Ingelheim have announced that they are in exclusive talks to swap the French pharmaceuticals company's Merial animal health business for the family-owned German group's consumer health operation.

Sanofi said Merial's enterprise value is EUR 11.4 (US$12.5) billion and Boehringer Ingelheim's CHC division has an enterprise value of EUR 6.7 (US$7.3) billion. Boehringer would also pay EUR 4.7 (US$5.1) billion in cash to Sanofi.

Combining Merial's and Boehringer Ingelheim's complementary strengths is expected to create the second largest player in the global animal health market with estimated pro forma sales of approximately EUR 3.8 (US$4.2) billion in 2015.

Olivier Brandicourt, CEO of Sanofi, said, "I am confident that Boehringer Ingelheim will enable Merial to fully express and develop its potential in the attractive but competitive animal health market.”

Dr. Andreas Barner, Boehringer’s chairman of the board, added, "Boehringer Ingelheim Animal Health is and will stay strongly committed to bringing novel, innovation driven solutions to veterinarians and animal owners. Our combined animal health business would be well positioned for growth and emergence as a leader globally.”