German pharmaceutical giant Bayer has agreed to purchase US nutritional supplement company Schiff Nutrition International for 1.2bn dollars.

Bayer has made a cash offer of $34 for each share of Schiff, pricing the company well above Friday's closing price of $23.19.

Healthcare subsidiary Bayer HealthCare has signed a merger agreement with Schiff, which specialises in vitamin products and other nutritional supplements. In fiscal 2012, it generated revenue of $259m.

"Bayer is committed to augment its organic growth with strategic bolt-on acquisitions. This transaction represents an excellent strategic fit for our HealthCare business," said Bayer Chief Executive Dr. Marijn Dekkers.

"The Schiff business significantly enhances our presence and position in the United States, which accounts for more over-the-counter and nutritional products sales than any other country in the world."

The operation may close by the end of the year.

By 10:39 in Frankfurt, shares of Bayer were up 0.3% to €67.20.

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