Actavis and Forest Laboratories have entered into a definitive agreement under which Actavis will acquire Forest for a combination of cash and equity valued at approximately $25 billion or $89.48 per Forest share, Actavis announced in a press release. The transaction will combine the two high-growth specialty pharmaceutical companies, with combined annual revenues of more than $15 billion anticipated for 2015.
"With this strategic combination, we create an innovative new model in specialty pharmaceuticals leadership, with size and scale, a balanced offering of strong brands and generics, a focus on strategic, lower-risk drug development, and— most important—the ability to drive sustainable organic growth," said Paul Bisaro, Chairman and CEO of Actavis.
On a pro forma combined basis for full year 2014, the combined company will have franchises in the therapeutic categories of central nervous system (CNS) (approximately $2 billion), gastroenterology (GI) and women's health (approximately $1 billion each), cardiovascular (approximately $500 million), and urology and dermatology/established brand (approaching $500 million a year in sales each).
“The acquisition builds on our blockbuster line call strategy in CNS and GI and dramatically extends our reach beyond the US market," said Brent Saunders, CEO and president of Forest, in the press release. "By joining forces with Actavis, we become more relevant to key physicians and customers through blockbuster franchises in CNS, Women's Health, GI and Urology, as well as Actavis' global generics business."
Paul Bisaro, Chairman and CEO of Actavis, will lead the combined company. The integration of the two companies will be led by the Actavis and Forest senior management teams, with integration planning expected to begin immediately to assure a rapid transition to a single company following close. Actavis has agreed that three members of the Forest Board of Directors will be named to the Actavis Board of Directors following the close.
The proposed transaction has been unanimously approved by the Boards of Directors of Actavis and Forest. The transaction is subject to the approval of the shareholders of both companies, as well as customary regulatory approvals, including a Hart-Scott-Rodino review in the US.