Allergan will escape hostile acquisition by Valeant by agreeing to be bought by Actavis
Allergan will escape hostile acquisition by Valeant by agreeing to be bought by Actavis. Canadian Valeant and its partner and investor, hedge fund manager William Ackman, do not consider a price of $66 billion paid by Actavis to be a fair value for an American Botox producer Allergan and are forced to end their pursuit. The failed acquisition is a blow to the reputation of Valeant previously considered an unsurpassed deal striker. The take over of Allergan by Actavis is the third largest deal in American healthcare history according to Standard&Poor’s.
Actavis was until recently based in New Jersey, USA, but last year after acquiring an Irish drug maker, Warner Chilcott, the company relocated its headquarters to Ireland, striking one of the first so-called inversion deals in order to reduce tax burden. The US Department of Treasury soon passed new rules to make it harder for companies to benefit from inversion deals. Actavis has already completed its relocation at that point and was, therefore, exempt from new regulations. Actavis took advantage of tax savings and acquired Forest Laboratories. Actavis will also be able to pay lower taxes on international sales of Allergan.
Sources: New York times, Reuters