Actavis will buy Botox-maker Allergan in $66B deal

Actavis (ACT) is paying $66 billion to buy fellow drugmaker Allergan (AGN) in a deal that could finally end a months-long takeover battle waged by Valeant Pharmaceuticals for the Botox maker. Shares of both Actavis and Allergan surged Monday morning on news of the deal. 

Shannon Stapleton/Reuters/File
Allergan Chief Executive David Pyott speaks during an interview in New York. Allergan Inc agreed to be bought by Actavis Plc for $66 billion, putting an end to a hostile bid by activist investor William Ackman and Valeant Pharmaceuticals International Inc, November 17, 2014.

Actavis is paying $66 billion to buy fellow drugmaker Allergan in a deal that could finally end a months-long takeover battle waged by Valeant Pharmaceuticals for the Botox maker.

Actavis said Monday that it will spend $219 in cash and stock for each share of Allergan.

That tops a bid for Allergan valued at about $53 billion and made last spring by Valeant Pharmaceuticals International Inc. and the hedge fund Pershing Square Capital Management. That offer totaled about $179 in cash and stock.

Allergan resisted the Valeant deal for months, but its board has unanimously approved the Actavis offer.

Last week, merger talks between Allergan Inc and white knight Actavis Plc were  focused on narrowing a gap of about $3 billion between what had been offered and what is wanted, Bloomberg reported.

Actavis was willing to pay around $200 per share, or $60 billion, while Allergan wanted more than $210 per share, Bloomberg said.

Allergan was trying to fend off a hostile takeover by Canadian drugmaker Valeant Pharmaceuticals International Inc , which had offered about $54 billion in cash and stock for the company.

Allergan said two weeks before that it was in talks with a second bidder, and sources familiar with the situation said the company was Actavis.

Separately, Allergan onchanged its bylaws on calling a special shareholder meeting. The move came ahead of a special meeting at which shareholders will vote on a proposal by activist investor William Ackman, who wants a rule change allowing the investors who requested the gathering to set the date for it.

Changing the bylaws is just one of the proxy proposals made by Ackman, who also wants to remove board members and compel Allergan into takeover talks.

The amended laws now include a provision that requires Allergan's board to call for a meeting within 90 days of a valid request rather than exercise its discretion, Allergan said.

The company also reduced the amount of information required from someone calling for a special meeting, and eliminated a requirement to disclose who is acting in concert with the shareholder making the proposal.

Ackman and proxy advisory firms pressured Allergan to change these rules, saying they were too onerous.

Allergan (AGN) shares surged over 7 percent in early morning trading. 

You've read  of  free articles. Subscribe to continue.

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to CSMonitor.com.