Valeant, Ackman offer to buy Botox maker Allergan for $47 billion

Tue Apr 22, 2014 4:24pm EDT
 
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By Rod Nickel and Bill Berkrot

(Reuters) - Canada's Valeant Pharmaceuticals International Inc said on Tuesday it and activist investor Bill Ackman made an unsolicited $47 billion bid to buy Botox maker Allergan Inc as it seeks to become one of the world's five biggest drug companies.

The offer, if successful, would bring together two mid-sized pharmaceutical companies with expertise in skin care and eye care products, and is highly unusual as activist investors typically buy stakes and then agitate for strategic change.

Ackman's Pershing Square Capital Management, Allergan's largest shareholder with a 9.7 percent stake, disclosed in a filing on Monday it is supporting the bid.

Allergan said in a statement that it has received the offer, and will carefully consider the proposal and "pursue the course of action that it believes is in the best interests of the company's stockholders."

Valeant offered to pay $48.30 a share in cash and 0.83 of its common share for each Allergan share, valuing Allergan at $152.88 a share, a premium of over 7 percent to the company's closing price on Monday.

The offer is 31 percent higher than Allergan's stock price on April 10, the day before Pershing Square's ownership reached 5 percent.

Shares of Allergan jumped 15.2 percent to $163.65 in New York, signaling investors expect a sweetened bid to emerge.

Valeant stock rose 7.5 percent to $135.41.   Continued...

 
A sample of Botox is seen at the Long Island Plastic Surgical Group at the Americana Manhasset luxury shopping destination in Manhasset, New York September 30, 2010. REUTERS/Shannon Stapleton