(Recasts to focus on possible Allergan deal)
Nov 5 (Reuters) - The top executive of Actavis Inc, which sources say is pursuing a “white knight” acquisition of Allergan Inc, made a case Wednesday for doing a deal, saying the drug company could continue to grow earnings and manage its debt load.
“If there was an opportunity, I think we’ve demonstrated as a team that if it was the right strategic opportunity with strong financial fundamentals that created long term enduring growth for our company, we would be very interested,” Actavis Chief Executive Brent Saunders told analysts during a conference call to discuss third-quarter earnings.
During the call, Deutsche Bank analyst Gregory Gilbert asked Saunders about the importance of biologics, and quipped on a potential name for the merged companies: “I’ll skip the ”Actergan“ question for now.”
Saunders responded, “Is that like Bennifer? You coined the first new phrase there?” - referring to a name used by the media for celebrities Ben Affleck and Jennifer Lopez when they were dating.
“I just wanted to get it on the record,” Gilbert said.
A “white knight” deal is a takeover by a favored party of a company in the midst of a hostile acquisition. Saunders was not specifically asked during the conference call about Allergan, which has been fighting a hostile takeover by Valeant Pharmaceuticals Inc for six months.
He discussed debt levels, capital deployment and bringing shareholders on board with a vote if required.
“I think given the need for consolidation and what’s happening in our industry ... companies that aren’t investing for long term value creation and long term growth are missing an opportunity,” he said.
Allergan disclosed earlier this week it had been approached by another party about a deal, and sources familiar with the situation had said the company was Actavis.
Earlier on Wednesday, Actavis reported better-than-expected quarterly results on strong growth in its branded drug business in North America.
On an adjusted basis, the company earned $3.19 per share, and revenue grew 46 percent to $3.68 billion. Analysts on average expected a profit of $$3.10 on revenue of $3.63 billion, according to Thomson Reuters I/B/E/S.
Those figures include $874 million for amortization of assets acquired when it bought Warner Chilcott and Forest Laboratories. (Reporting by Caroline Humer and Ankur Banajaree in Bangalore; Editing by Bernadette Baum)