Valeant Pharmaceuticals International Inc. and Salix Pharmaceuticals Ltd. have entered into an agreement under which Valeant will acquire the outstanding common stock of Salix for $158 per share in cash, or a total enterprise value of about $14.5 billion, according to a press release.
Salix Pharmaceuticals is known for its gastrointestinal portfolio of 22 products, including prescription brands Xifaxan, Uceris, Relistor and Apriso.
"Salix's market-leading gastrointestinal franchise is an ideal strategic fit for Valeant's diversified portfolio of specialty products," said J. Michael Pearson, Valeant's chairman and CEO. "The growing GI market has attractive fundamentals, and Salix has a portfolio of terrific products that are outpacing the market in terms of volume growth and a promising near-term pipeline of innovative products...."
Thomas W. D'Alonzo, chairman of the board and acting CEO of Salix, said, "We are pleased to have reached an agreement with Valeant, which is a logical partner and importantly, creates immediate value for our shareholders. Combining Salix's leading market position in gastroenterology with Valeant's scale and resources will create a stronger and more diverse business committed to providing better health solutions to health care providers and their patients."
The combination is expected to yield greater than $500 million in annual cost savings from the cost base of the combined company, the release said. Synergies are expected to be achieved within six months of close, primarily from reductions in corporate overhead and R&D rationalization, with the cost to achieve these synergies to be approximately 65%.
The transaction is expected to close in the second quarter of 2015. Read the full release