In a cash-and-stock deal valued at $45.7 billion, Valeant Pharmaceuticals Inc. would give Allergan investors $48.30 in cash and 0.83 percent in Valeant stock for each share they own. Pershing Square Capital Management LP, the fund run by Bill Ackman, Allergan’s largest shareholder, supports the deal.
According to a Statement by Valeant, the bid is a “substantial premium” on Allergan’s unaffected price of $116.63 on April 10, the day before Pershing crossed the 5 percent ownership level and commenced it’s rapid accumulation program.
A filing yesterday with the U.S Securities and Exchange Commission read, Valeant and Pershing Square’s, Ackman, think Allergan is undervalued, and an attractive investment. Pershing Square amassed 9.7 percent of Allergan after reaching an agreement with Valeant to jointly pursue a hostile takeover of the company.
“We firmly believe that combining Valeant and Allergan would create an unrivaled platform for growth and value creation in health care,” Valeant said in an email.
Valeant’s major emphasis in generic drugs has been expanded into specialty medicines such as, opthalmology, dermatology and dentistry. In 2008, when Chief Executive Officer, Mike Person took over, at least $19 billion was spent on more than 35 companies as part of Laval, Quebec-based Valeant’s goal to join in with the world’s largest drug makers.
“I don’t think it’s any secret that a combination of Valeant and Allergan would make a lot of sense,” Timothy Chiang, an analyst at CRT Capital Group LLC in Stamford Connecticut, said in a telephone interview. “The question has always been, it’s not whether Valeant would be interested in buying Allergan, it’s a question of would Allergan want to sell to Valeant.” A spokeswoman for Allergan, Bonnie Jacobs, did not respond for comment.
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