After Endo International offered a rival bid, Valeant Pharmaceuticals International announced that it has raised its offer for gastrointestinal drugmaker Salix Pharmaceuticals.
The companies announced that they have entered into an amendment to their agreement and plan merger. Valeant has increased its offer price to acquire all the outstanding common stock of Salix from $158 per share to $173 per share in cash, or a total enterprise value of approximately $15.8 billion, through April 7, 2015. The new deal will provide Salix shareholders with an additional $1 billion in cash considerations.
In February, Valeant made an all-cash offer for $158 per share, a deal valued at roughly $10.1 billion. Last week, specialty drugmaker Endo offered 11 percent more for Salix, in a cash and stock deal valued at $175 per Salix share, or roughly $11.17 billion. Now, Valeant raised its offer to approximately $11.11 billion in cash.
“We continue to be very excited about the combination of our two companies and we are committed to getting this deal done,” said J. Michael Pearson, chairman and chief executive officer of Valeant. “This revised offer provides Salix shareholders with all-cash at a significant premium and the certainty to close by April 1. By offering a significant premium with a 100% cash offer, eliminating market and company equity risk that could arise from non-cash offers with a 4+ month closing timeline instead of closing by April 1st, our new arrangement creates significant shareholder value for Salix. In addition, the transaction remains modestly accretive in 2015 and will be more than 20% accretive in 2016.”
If all of the conditions to the tender offer are not satisfied by April 8, the offer price will drop back to $158 per share. Both companies’ Boards of Directors have approved the amendment.
“We are pleased that the enhanced offer price recognizes the value of Salix as the leading gastrointestinal specialty pharmaceutical company and delivers to our stockholders all cash consideration in the near future,” said Thomas W. D’Alonzo, chairman of the board and acting chief executive officer of Salix.
Source: Valeant Pharmaceuticals International, Inc.
Last updated: 3/16/15; 10:45am EST