By Chelsey Dulaney
Actavis PLC outlined new details of its planned acquisition of
Allergan Inc. on Tuesday, including plans to appoint two Allergan
directors to its board and a $2.1 billion breakup fee.
Actavis on Monday agreed to pay $66 billion in cash and stock
for Allergan in a combination that would make Actavis one of the
globe's largest drug makers by sales, led by Allergan's antiwrinkle
treatment Botox.
Allergan and Actavis expect a deal, which must be approved by
shareholders and regulators, would close in the second quarter next
year and be accretive within the first year. The combined company
would have $23 billion in sales next year, more than 30,000
employees and a market capitalization of $128 billion, about 12
times Actavis's equity value just two years ago.
In a regulatory filing Tuesday, Actavis set a breakup fee of
$2.1 billion if the deal fails to go through. The company's board
currently has 14 directors, including Chief Executive Brent
Saunders, according to its website.
The deal appears to have shielded Allergan from a hostile
takeover by Valeant Pharmaceuticals International Inc., which had
teamed up with activist investor William Ackman and his hedge fund
Pershing Square Capital to bid $53 billion for Allergan. Valeant
CEO Michael Pearson said Monday that the company will review
Actavis's offer but indicated the price was now too steep for a
counteroffer.
Shares of Allergan, up 88% this year, and Actavis, up 48% this
year, were largely inactive premarket.
Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com
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