The sale of Elanco's aqua business to Merck for $1.3 billion is a significant transaction for ELAN, likely to positively impact its financials by providing a substantial cash influx. The deal's valuation at 7.4 times the estimated 2023 revenue of the aqua business indicates a strong return on assets for Elanco. This divestiture could be seen as a strategic move to streamline operations and focus on more profitable segments, potentially leading to a positive market reaction.

Merck's acquisition of Elanco's aqua business for approximately $1.3 billion is a strategic expansion into the aquaculture sector, a move likely to be viewed positively by the market. This acquisition not only adds approximately $175 million in estimated revenue but also includes valuable R&D projects, manufacturing sites, and a skilled workforce. The deal's valuation suggests confidence in the aqua business's growth potential and could enhance Merck's overall market position in the animal health industry.