Elanco Animal Health has announced it has entered into an agreement with Bayer AG to acquire its animal health business, in a transaction valued at US$7.6 billion (£6.2bn).

The transaction, which is subject to regulatory approval and other customary closing conditions, will double Elanco’s companion animal business.

Jeffrey N. Simmons, president and chief executive officer of Elanco, said: “Joining Elanco and Bayer Animal Health strengthens and accelerates our IPP (innovation, portfolio and productivity) strategy and transforms our portfolio with the addition of well-known pet brands, brings an increased presence in key emerging markets, expands innovation, and accelerates our margin expansion journey.

“The move combines our long-standing focus on the veterinarian while meeting pet owners’ changing expectation of pet care and access to products.”

Bayer AG’s chief executive officer, Werner Baumann, added: “Our animal health business is among the pioneers of this sector, having built up an attractive portfolio and secured well-established market positions in the companion and farm animal segments.”