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By Sophie Sassard and Soyoung Kim

LONDON/NEW YORK, May 1 (Reuters) - German drugmaker Bayer AG is nearing an agreement to buy Merck & Co Inc's consumer healthcare unit, people familiar with the matter said, in a deal that could value the business at around $14 billion.

Reckitt Benckiser Group, one of the final contenders in the auction, said on Wednesday it was no longer in active talks to buy the Merck business, leaving Bayer in the pole position to win the asset, which is best known for Coppertone sunscreen and Claritin allergy medicine.

Bayer and Merck are hammering out final terms of an agreement and could announce the transaction in the next several days, the people said, asking not to be named because the matter is not public. Representatives for Bayer and Merck declined to comment.

Reuters first reported last week that Bayer and Reckitt had emerged as frontrunners in the auction with each offering roughly $13.5 billion, a price that could come close to $14 billion when the deal is finalized.

Bloomberg News reported on Thursday that Bayer entered exclusive talks with Merck.

Bayer has also edged out other rival bidders in the auction, including Procter & Gamble Co, Boehringer Ingelheim, Novartis AG and Sanofi SA, people familiar with the matter said.

(Reporting by Sophie Sassard in London and Soyoung Kim in New York; Editing by Steve Orlofsky)