Actavis to acquire Forest

Generics company Actavis plc (NYSE:ACT) will acquire specialty pharma Forest Laboratories Inc. (NYSE:FRX) in a cash and stock deal that the companies said values Forest at about $89.48 per Forest share, or about $25 billion. The price is a 25% premium to Forest's close of $71.39 on Friday, the last trading day before the deal was announced. Forest shareholders will receive $26.04 per share in cash and 0.3306 Actavis shares, or about 34% of the combined company based on both companies' outstanding shares. The companies said the deal will create a specialty pharma with a "balanced portfolio" of branded and generic drugs and strong global commercial capabilities. Actavis reported $5.9 billion in revenues for the nine months ended Sept. 30, 2013. Forest reported $2.6 billion in revenues for the same period. The combined company will be led by Paul Bisaro, Actavis' CEO and chairman. Brenton Saunders, Forest's president, CEO and a director, will join Actavis' board, along with two other Forest directors.

Saunders took the reins at Forest on Oct. 1 and in short order unveiled a host of new initiatives, including a restructuring, a debt offering, a new share repurchase program and last month's $2.9 billion acquisition of gastrointestinal company Aptalis Holdings Inc. (see BioCentury Extra, Jan. 8). ...