Watson Pharmaceuticals has entered into a definitive agreement to acquire Arrow Group, a move that will create a global pharmaceuticals company with over $3bn in revenue.

The deal for $1.75bn in cash and stock will create commercial operations in over 20 countries, and a robust product portfolio and pipeline.

Watson president and CEO Paul Bisaro said that the move was a realisation of the company’s strategic vision to leverage assets across developed and emerging markets around the world.

“The combined company will have a global infrastructure and a strong product portfolio and pipeline which create significant opportunities for long-term growth,” Bisaro said.

“Additionally, Arrow‘s manufacturing network, including facilities in Canada, Malta and Brazil, will further expand Watson’s global supply chain.”

The transaction is expected to close in the second half of 2009, and be accretive to cash earnings per share in 2010 before synergies.