US drug maker Actavis has struck a $5bn deal to acquire Ireland’s Warner Chilcott as it looks to fend off takeover threats.
Once complete, the transaction, valued at $8.5bn including net debt, is expected to create a global speciality generic and patented drug group worth $11bn.
The announcement comes two months after competitors, including Valeant and Mylan, made efforts to acquire Actavis.
Actavis president and CEO commented on the deal: "The combination of Actavis and Warner Chilcott creates a strong specialty brand portfolio focused in therapeutic categories with strong growth potential, and is supported by a deep pipeline of development programs.
"The combination is commercially and financially compelling, and reshapes the specialty pharmaceutical universe by creating a powerful global competitor. It creates a company with an exceptionally strong balance sheet, coupled with a favorable tax structure to support future growth."
Under the deal, Warner Chilcott shareholders will receive 0.16 shares in Actavis for each share they own, equivalent to $20.08 per share.
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The combined entity will focus on women’s health, gastroenterology, urology and dermatology.
The proposed transaction, expected to be completed by the end of 2013, has been unanimously approved by the Boards of Directors of Actavis and Warner Chilcott, and is supported by the management teams of both companies.
Image: Activis’ acquisition will create a speciality generic and patented drug group. Credit: FreeDigitalPhotos.net.