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Kimberly-Clark has agreed a deal worth $48.7bn to acquire Kenvue, a struggling consumer health product firm that was spun off from Johnson & Johnson in 2023.

Kenvue’s shareholders will get $21.01 per share in cash and stock, which implies a premium of 46.2 per cent to the stock’s last closing price.

Kenvue’s stock has fallen by about a third this year after weak performance in its skin health and beauty division, which includes brands such as Neutrogena, Aveeno, and Clean & Clear.

The company’s Tylenol brand also faced pressure after US health secretary Robert F Kennedy Jr entertained unfounded links between the use of the OTC painkiller during pregnancy and autism.

In a statement the companies said: “This transaction brings together two iconic American companies to create a combined portfolio of complementary products, including $10 billion dollar brands, which touch nearly half the global population through every stage of life.

Kenvue has struggled as a standalone business and has been targeted by a succession of activist hedge funds. The company ousted its CEO, Thibaut Mongon, in July, and initiated a strategic review, which some investors said laid the groundwork for an eventual sale of the company or parts of it.

Based on current projections, the combined company will generate 2025 annual net revenues of approximately $32bn and $7bn of adjusted EBITDA. Kimberly-Clark and Kenvue stated that they have identified approximately $1.9bn in cost synergies and approximately $500m in incremental profit from revenue synergies, partially offset by reinvestment of approximately $300m.

Kenvue chairman Larry Merlo said: “Following the Board’s comprehensive review of strategic alternatives for Kenvue, 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.”