Roger Yu

USA TODAY

German chemical manufacturer Merck KGaA said Monday it agreed to buy Sigma-Aldrich for about $17 billion to expand its business in North America and gain exposure in Asia.

Merck KGaA is paying $140 per share in cash for all shares of St. Louis-based Sigma. On Friday, Sigma shares closed at $102.37.

Merck KGaA, whose headquarters is in Darmstadt, Germany, shares the corporate name and has had historical ties with American drug-maker Merck & Co., but the U.S. company is independent.

After the merger is completed, the combined company will supply more than 300,000 products to labs and research facilities worldwide, ranging from liquid crystals and pigments to DNA strands and chemicals used in animal testing. The merger is estimated to generate about $340 million in "synergy" savings in three years, it said.

Based on fiscal year 2013 financials, the post-merger company would have had combined sales of $6.1 billion and earnings of $2 billion before interest, taxes, depreciation and amortization.

The deal, which has been unanimously approved by Sigma-Aldrich's board of directors, is expected to close in mid-year 2015.

Merck KGaA, whose U.S. operation is based in Billerica, Mass. and operates under the corporate name, EMD Millipore, plans to maintain "significant presence" in St. Louis, Mo., and in Massachusetts.

"In one of the world's key industries two companies that fit perfectly together have found each other to present a much broader product offering to our global customers in research, pharma and biopharma manufacturing and diagnostic and testing labs," said Karl-Ludwig Kley, chairman of Merck KGaA's executive board.