Actavis Allergan Merger Agreement

The world of pharmaceuticals has been abuzz with news of the Actavis Allergan merger agreement. The $70.5 billion deal, which was announced in November 2014, has been one of the largest in the history of the pharmaceutical industry. This article will provide an overview of the deal, what it means for both companies, and what lies ahead.

Background of the Deal:

Actavis, a global pharmaceutical company, was established in 1983 by two pharmacists in Iceland. Over the years, the company has grown through mergers and acquisitions and is now headquartered in Ireland. Allergan, on the other hand, was founded in 1950 in California and has become well-known for its Botox product. The company has also grown through mergers and acquisitions and is headquartered in Dublin, Ireland.

The Actavis Allergan merger agreement was announced in November 2014, after months of discussions. The deal was structured as a stock and cash transaction, with Actavis acquiring all outstanding shares of Allergan. The transaction was valued at $219 per Allergan share, with shareholders receiving $129.22 in cash and 0.3683 Actavis shares for each Allergan share. The deal was completed in March 2015.

What Does the Merger Mean for Both Companies?

The Actavis Allergan merger agreement has created one of the largest pharmaceutical companies in the world. The combined company now has a market cap of around $160 billion and is expected to generate more than $23 billion in revenue annually. With a presence in more than 100 countries, the company is well-positioned to take advantage of growth opportunities in emerging markets.

For Actavis, the merger has helped to solidify its position as a major player in the pharmaceutical industry. The company`s product portfolio has been significantly expanded by the addition of Allergan`s products, which include Botox, Restasis, and Juvederm. The merger has also enabled Actavis to diversify its revenue streams and reduce its dependence on its top-selling products.

For Allergan, the merger has provided a way out of a hostile takeover bid by Valeant Pharmaceuticals. The deal with Actavis was seen as a better alternative by Allergan`s board and shareholders, as it offered a higher premium and provided better growth prospects.

What Lies Ahead?

The Actavis Allergan merger agreement has been well-received by investors, with both companies` shares rising significantly since the announcement. However, the merged company still faces challenges, including patent expirations, generic competition, and regulatory hurdles.

One area of concern is the potential for antitrust issues, as the combined company now has a significant share of the market in certain therapeutic areas. The company will likely need to divest some assets to address these concerns.

Another challenge will be integrating the two companies and creating a cohesive culture. This will require strong leadership, effective communication, and a willingness to make tough decisions.

Despite these challenges, the Actavis Allergan merger agreement is a significant milestone for both companies and the pharmaceutical industry as a whole. The merged company is well-positioned to take advantage of growth opportunities and continue to provide innovative products to patients around the world.