The hedge fund mogul William A. Ackman and Valeant Pharmaceuticals unveiled on Tuesday a $45.6 billion takeover offer for the maker of Botox, Allergan, in an unusual pairing of activist investor and corporate buyer that could reshape the deal landscape.
Under the terms of the bid, Valeant will pay $48.30 a share in cash and 0.83 of one of its shares for each Allergan share. At Monday’s closing price, the offer is worth about $152.89 a share, a 31 percent premium to what they called Allergan’s unaffected stock price of $116.63.
Mr. Ackman’s firm, Pershing Square Capital Management, has already disclosed owning a 9.7 percent stake in Allergan.
Valeant said that the proposed merger would create a powerhouse in the eye care, dermatology and cosmetic drug businesses. The company, a serial acquirer whose deals included the $8.7 billion takeover of Bausch & Lomb last year, would gain control of popular treatments like Botox, Latisse eyelash enhancer and a lap band device.
“This proposal represents an undeniable opportunity to create extraordinary value for both Allergan and Valeant shareholders by establishing an unrivaled platform with leading positions in ophthalmology, dermatology, aesthetics, dental and the emerging markets†J. Michael Pearson, Valeant’s chairman and chief executive, said in a statement.
Mr. Ackman added: “The combination of Valeant and Allergan represents the most strategic and value-creating transaction I have ever analyzed. I strongly urge the Allergan board of directors to carefully examine the proposed transaction and enter into negotiations with Valeant so that a merger can be consummated promptly.â€
If successful, the joint bid could provide a new template for how deals are done at a time when activist investors are ascendant. By teaming up with Mr. Ackman, Valeant has gained a valuable ally who is experienced in battling recalcitrant corporate boards â€" and who also controls a sizable portion of the target company’s stock.
But the proposed acquisition, the first of its kind, also raises pressing questions about how activists and corporations work together and how companies defend themselves against hostile bidders.
Valeant and Mr. Ackman disclosed on Monday that the takeover bid would involve $15 billion in cash, supported by financing from Barclays and the Royal Bank of Canada.
In a statement on Monday night, Allergan said that it would evaluate any offer made by Valeant and Mr. Ackman.
Besides Barclays and R.B.C., Valeant is receiving advice from the law firms Sullivan & Cromwell; Skadden, Arps, Slate, Meagher & Flom; and Osler, Hoskin & Harcourt.
Mr. Ackman’s firm is being counseled by Kirkland & Ellis and Davies Ward Phillips & Vineberg.
