Forest sold to Actavis for $25 billion
pharmafile | February 18, 2014 | News story | Sales and Marketing | Actavis, CNS, Forest, acquisition, labs, merger, synergy
The rumours of a substantial deal for Forest have been proven true after Actavis announced this afternoon that it will buy the firm for $25 billion.
The cash-and-share agreement values each Forest share at about $89.48 – a 25% per share premium on Forest’s closing price on Monday (17 February).
In a joint statement Actavis and Forest said that by combining the two firms they could realise as much as $1 billion in synergies.
The deal is expected to close in mid-2014, pending approvals.
Actavis said that if successfully completed: “The transaction will combine two of the world’s fastest-growing speciality pharmaceutical companies, with combined annual revenues of over $15 billion anticipated for 2015”.
The proposed operation has been unanimously approved by the boards of directors at Actavis and Forest, and is ‘enthusiastically supported’ by the management teams of both companies.
On a pro forma combined basis for 2014, the joint company will have around $2 billion in its central nervous system (CNS) business; gastroenterology and women’s health franchises, which is valued at around $1 billion each.
It will also see an increase in the cardiovascular franchise that generates around $500 million; and urology and dermatology/established brand businesses, which is currently approaching $500 million a year in sales each.
Biggest deal to date
Actavis has been hitting the acquisition trial hard in recent years, but the Forest purchase is the company’s biggest-ever, dwarfing 2013’s $8.5 billion acquisition of Ireland-based Warner-Chilcott.
Actavis itself was acquired for €4.5 billion by US generics firm Watson in 2012, later giving its name to the combined group.
Paul Bisaro, chairman and chief executive of Actavis (who will lead the new combined firm) said: “As chairman of Actavis, I am in a unique and enviable position of having two exceptionally experienced and successful management teams committed to creating a new future for the combined company.
“Over the next several months, as we prepare for the integration and closing, our teams will define the structure necessary to capitalise on Actavis’s global leadership in brand, generic, biosimilar and [over the counter] pharmaceuticals.”
Forest’s chief executive Brent Saunders will join the Actavis board following the completion of the deal.
The integration of the two companies will be led by the Actavis and Forest senior management teams, with integration planning expected to begin immediately.
Saunders said: “Forest is a great fit with Actavis due to our strong legacy in branded speciality and primary care pharmaceuticals with a best in class commercial team, a top-notch drug development organisation and a long history of successful partnerships.”
Ben Adams
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