UPDATE 1-Actavis in talks to buy Forest Labs for as much as $25 bln - WSJ

Tue Feb 18, 2014 12:04am EST
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Feb 18 (Reuters) - Actavis Plc is in advanced talks to acquire rival drug maker Forest Laboratories Inc in a deal that could value Forest at up to $25 billion, the Wall Street Journal reported citing people familiar with the matter.

The deal is expected to be announced as early as Tuesday, but it is possible that the talks could still fall apart, the Journal said. ()

Amanda Kaufman, a Forest Labs spokeswoman, said the company does not comment on market rumors. Reuters could not immediately reach Actavis for comment outside of regular business hours.

A combined Actavis-Forest could offer a range of generic and brand-name medicines, reaping economies of scale of its own, the Journal said.

Actavis competes with larger drugmakers such as Teva Pharmaceuticals Industries Ltd and Mylan Inc.

Actavis has turned to acquiring specialty branded drugs, which have far higher profit margins than generics, to boost earnings.

Forest has a market capitalization of $19.34 billion as of Friday's close, compared with $33.40 billion for Actavis, according to Thomson Reuters data.

Forest had wrangled with billionaire investor Carl Icahn for years and ultimately struck a deal with him last summer that averted a proxy fight. It is still facing patent expirations on several of its biggest drugs, including Namenda, which is prescribed to improve cognitive function in people with Alzheimer's disease.   Continued...