This Kimberly-Clark Kenvue Deal? Smells Like Desperation.
Oh, great. Just what we needed: another freaking mega-corporation sucking up all the oxygen in the room. Kimberly-Clark’s buying Kenvue for almost $49 billion? Gimme a break. So now, the same company that brings you the joy of wiping your butt with Cottonelle will also be responsible for numbing your pain with Tylenol. What a world.
And let's be real, this ain't about "synergy" or "unlocking value." This is about two companies desperately trying to stay relevant in a world that's increasingly saying "screw the name brands" and reaching for the generic stuff. I mean, did you see Kimberly-Clark's stock price after the announcement? Down 15%. The market smells the BS too.
Kenvue, spun off from Johnson & Johnson just two years ago, was supposed to be this nimble, independent powerhouse. Instead, it got "targeted by activist investors unhappy about the trajectory of the company." Translation: they screwed up. Big time. Apparently relying too much on "legacy brands" doesn't cut it anymore. Who knew?
And Kimberly-Clark? They're facing the same problem. Store brands are eating their lunch. 51% of toilet paper sales are now generic. 51%! That's not a trend; that's a freakin' avalanche. So, what do they do? Buy another company with a bunch of name-brand products that are also losing ground to generics. Brilliant. Tylenol, Kleenex, Band-Aid and more put under one roof in $48.7 billion consumer brands deal
Okay, this is where things get truly bizarre. Apparently, Tylenol (now under the Kenvue umbrella) got dragged into some Trump-era conspiracy theory about vaccines and autism. Trump and RFK Jr. pushing this garbage? And pregnant women being warned off Tylenol? What the actual hell?
I mean, I know we live in a post-truth world, but come on. It's Tylenol! It's been around forever. Are we really at the point where even basic pain relievers are subject to political conspiracy theories? What's next, QAnon claiming that Kleenex is made from recycled lizard people?
Kenvue, to their credit, pushed back on the Trump administration's claims. "We strongly disagree with allegations that it does and are deeply concerned about the health risks and confusion this poses for expecting mothers and parents," they said. Good for them. But the fact that they even had to say that is a testament to how far gone we are.
It makes you wonder what kind of world we're building when the basics of science and medicine are constantly being questioned. Are we really going to let conspiracy theories dictate our healthcare choices? Maybe I'm just getting old, but this feels like a particularly dark timeline.
So, what's the play here? Kimberly-Clark and Kenvue are promising $1.9 billion in cost savings within three years. Translation: layoffs. Lots and lots of layoffs. And probably some "streamlining" of product lines, which means your favorite version of Listerine is about to disappear.
And let's not forget the history of these mega-mergers. Kraft Heinz? A disaster. Net revenue down every year since 2020. Citi Investment Research is already worried about the "deal’s size given the recent history in the sector."
But hey, at least Mike Hsu, the chairman and CEO of Kimberly-Clark, gets to be the chairman and CEO of the combined company. So, that's good for him. For the rest of us? We get fewer choices, higher prices, and the lingering fear that our toilet paper is somehow connected to a vast, shadowy conspiracy. Great.
