By Chelsey Dulaney
Endo International PLC agreed to buy Par Pharmaceutical Holdings
Inc. from private-equity firm TPG for about $8 billion in cash and
stock, giving Dublin-based Endo access to profitable generic
drugs.
Par, which TPG took private in 2012 for about $1.9 billion, has
a portfolio of nearly 100 products, including oral solids and
injectables. Endo said the combined company would have a generics
business that ranks among the top five by U.S. sales.
The deal comes after Endo lost a bid to buy Salix
Pharmaceuticals Ltd. in March after being outbid by Valeant
Pharmaceuticals International Inc.
Shares of Endo fell 2.7% to $83.07 in morning trading.
The deal for the Chestnut Ridge, N.Y.-based Par includes 18
million shares--valued at about $1.5 billion, based on Friday's
close--and $6.5 billion in cash. The deal's total value of $8.05
billion, includes a small amount of debt assumption.
The deal, subject to regulatory approval, is expected to close
in the second half of the year.
The pharmaceutical industry has been a particularly hot sector
for deal-making lately, as companies take advantage of a favorable
M&A environment to buy up rivals to add to their sales.
Last year was the best year for mergers in the industry since
Dealogic began keeping records in 1995.
So far this year, Pfizer Inc. has struck a $16 billion deal to
buy Hospira Inc., Merck & Co. bought antibiotic makerCubist
Pharmaceuticals Inc. for $8.4 billion, and Alexion Pharmaceuticals
Inc. agreed to pay a 124% premium to buy Synageva BioPharma
Corp.
Meanwhile, Endo has been benefiting from its recent
acquisitions. Earlier this month, Endo reported
better-than-expected adjusted earnings from operations in its first
quarter.
In January, the company closed its $2.6 billion purchase of
Auxilium Pharmaceuticals Inc., a transaction that followed deals to
buy Boca Pharmacal and DAVA Pharmaceuticals. The latter deals have
been key for its generic-drug segment, which jumped 68% in the
latest quarter.
Endo expects the Par deal to add to its adjusted per-share
earnings within a year and forecast double-digit growth in
2016.
The company expects $175 million in operational and tax
synergies.
Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com
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