Novartis, the Swiss drugs giant, has agreed to acquire 25 per cent of Alcon from Nestlé for about $11 billion (£5.53 billion) in a first step towards taking control of the eyecare group for up to $40 billion.

The Basel-based pharmaceuticals company said yesterday that the deal gave it the right to acquire Nestlé's remaining 52 per cent stake in Alcon for about $28 billion between January 2010 and July 2011.

The two-stage transaction, worth $39 billion, will give Novartis 77 per cent of the world's biggest eye-care company with sales last year of $5.6 billion and operating income of $1.9 billion.

The move is a sign that large mergers and acquisitions can still go ahead despite the global credit squeeze.

Novartis's deal is the fourth-biggest bid so far this year, after Microsoft's $44.6 billion approach to Yahoo!, Chinalco's $14.3billion acquisition of a stake in Rio Tinto, the mining giant, and CME's $11.1 billion merger with Nymex. It is also the third-largest deal in the healthcare sector in 16 months.

As well as boosting Novartis's portfolio of brands with Travatan solution for contact lenses, Vigamox antibiotic solution for eye infections and the Opti-Free line of contact lens care products, the deal will also open the door for further acquisitions at Nestlé.

Nestlé said that the deal would enable it to seek acquisitions above its previous, self-imposed ceiling of about $2 billion annually.

A spokesman for the Swiss food group said: “If we believe an acquisition is strategically necessary, we will make it. If that should be a company that costs considerably more than we spend year in and year out for acquisitions, clearly we do have the financial punch to make acquisitions.”

Analysts cited the French cosmetics giant L'Oréal as a possible takeover target. Both Nestlé and the Bettencourt family have stakes of about 30 per cent in L'Oréal, but neither is allowed to sell until April next year.

Novartis, which already has a contact lens and ophthalmic pharmaceuticals business, said that the eyecare market was growing rapidly, driven partly by an increase in age-related eye diseases.

It intends to finance the first step of the deal from internal cash reserves and short-term debt, with borrowing needs estimated at $5.5 billion. Financing for the second step would come from continuing cash generation and further external borrowing.

Novartis said that it would be able to achieve synergies from combining Alcon with its own eye-related businesses only after the second stage is completed.

Cary Rayment, who has been with Alcon since 1989, will remain with the business as chairman, president and chief executive. The company has 14,500 staff in 75 countries, with half of its sales coming from America. Alcon spent $564 million on research and development last year, about 10percent of sales, and has $3.5 billion of investment in the pipeline, including 15 late-stage projects.

Alcon, founded in 1945, was acquired by Nestlé in 1978 and spun off in a partial initial public offering in 2002 on the New York Stock Exchange. It is incorporated in Hünenberg, Switzerland, and its US operations are based in Fort Worth, Texas.

Daniel Vasella, chairman and chief executive of Novartis, said that the acquisition was an ideal strategic fit. “Eye care will continue to grow dynamically as there is a growing unmet medical need, driven primarily by the world's ageing population,” he said.

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