Kimberly-Clark advances Kenvue acquisition with debt swap and EU remedies

Kimberly-Clark has begun restructuring preparations for its planned Kenvue acquisition by offering holders of Kenvue notes an exchange for up to US$7 billion in new Kimberly-Clark debt securities and cash. The move is aimed at aligning the companies’ financing structures ahead of the merger. 

The arrangements mark a financial step toward Kimberly-Clark’s planned acquisition of Kenvue, with it aligning financing structures ahead of the expected merger completion.

The move comes after Reuters reported that Kimberly-Clark has offered concessions to meet EU antitrust concerns, which could help it secure the approval for the deal after a preliminary review. 

The merger of the two companies is set to bring together brands such as Huggies and Kleenex with Band-Aid and Tylenol, generating an estimated net revenue of roughly US$32 billion in 2025.

Debt exchange

Kimberly-Clark Corporation has announced the commencement of exchange offers and consent solicitations for Kenvue notes and bonds.

The company, whose largest shareholders are institutional asset management firms led by BlackRock, Vanguard, and State Street, announced it will buy Kenvue in a deal valued at approximately US$48.7 billion in November 2025. The transaction brings together two major US companies, creating a combined portfolio of complementary products, including 10 billion-dollar brands, according to Kimberly-Clark. 

Kimberly-Clark announced that it would acquire all of the outstanding shares of Kenvue common stock in a cash-and-stock transaction when it first announced the planned acquisition. 

The exchange offers represent another preparatory step ahead of the expected Q4 2026 closing timeline, subject to regulatory approvals and other closing conditions.

Kimberly-Clark is offering investors an exchange for any and all outstanding notes issued by Kenvue for up to US$7 billion in aggregate principal amount of new notes to be issued by Kimberly-Clark and cash.

Alongside the exchange offers, Kimberly-Clark is soliciting consents from “eligible holders” to adopt certain proposed amendments to Kenvue’s existing contracts with concerned holders. 

Kimberly-Clark is making the consent solicitations to smooth the acquisition process by managing Kenvue’s existing debt, simplifying financing, and aligning borrowing arrangements under Kimberly-Clark’s fiscal structure. 

By replacing Kenvue debt with Kimberly-Clark debt, the combined company can have a more unified financing structure. The exchange offers expire on October 27.

EU competition concerns 

Meanwhile, Kimberly-Clark has offered concessions to address EU antitrust concerns about the company’s pending acquisition of Kenvue, reports Reuters. The European Commission is assessing whether the transaction could reduce competition in certain consumer health and personal care categories. 

The commission, which acts as the EU competition enforcer, did not provide details of the remedies in line with its policy, says Reuters. The regulatory body also extended its deadline for a decision from September 29 to October 13.

According to Reuters, the commission is expected to “seek feedback from rivals and customers before deciding whether to accept the concessions, demand more, or open a full-scale four-month-long investigation.”

While the conditions of the concessions are not yet known, Kimberly-Clark has made deals to offload brands, primarily in menstrual care, to secure approval in other regions. 

Both Kimberly-Clark and Kenvue contain competitive period care brands in their portfolios, with Kimberly-Clark’s Kotex head-to-head with Kenvue’s Carefree, Stayfree, Sempre Livre, and OB. Regulators appear to be focusing on the segment to mitigate the merger risks to antitrust concerns. 

Australia’s competition regulator approved the deal conditionally, requiring Kimberly-Clark to divest Kenvue’s Carefree and Stayfree brands in Australia. The two companies are two of the three major period care suppliers in the Australian market.

In Brazil, Essity entered into an agreement to acquire Kenvue’s feminine care business last month. The deal includes brands such as Carefree, Sempre Livre, and OB and amounts to US$284 million on a cash and debt-free basis. The acquisition is expected to close during the second quarter of 2027.

Kimberly-Clark and Kenvue’s divestments could create openings for rivals to buy, with Essity’s Brazil purchase illustrating how sales can strengthen brand competition.

Kimberly-Clark also secured conditional approval of the Kenvue merger in South Africa last month.