Date
21 October 2017
Valeant will pay US$158 a share for Salix, which is known for its stomach discomfort drug Xifaxan. Photo: thestar.com
Valeant will pay US$158 a share for Salix, which is known for its stomach discomfort drug Xifaxan. Photo: thestar.com

Canada’s Valeant buys Salix in US$10 bln cash deal

Canada’s Valeant Pharmaceuticals International Inc. has agreed to acquire gastrointestinal drugmaker Salix Pharmaceuticals Ltd. in an all-cash deal worth US$10.1 billion, acording to the two companies.

Salix is known for its irritable bowel syndrome drug Xifaxan.

The companies said the deal had an enterprise price value of US$14.5 billion, which would include Salix’s debt and any cash on hand, Reuters reported.

Valeant will pay US$158 a share, putting the all-cash transaction value at about US$10.1 billion.

The merger is expected to yield more than US$500 million in annual cost savings from the cost base of the combined company, the report said.

The transaction is expected to close in the second quarter and is subject to customary closing conditions and regulatory approval.

The deal is the largest ever for Laval, Quebec-based Valeant, which lost a takeover contest for Allergan Inc. last year.

The usually acquisitive Valeant slowed its buying pace dramatically while it pursued Allergan.

Last month, chief executive Michael Pearson said the company would focus in 2015 on smaller, private acquisitions.

British drugmaker Shire Plc. had taken initial steps to acquire Salix and was working with advisers on a potential offer, according to people familiar with the matter.

Endo International Plc. had expressed interest but was rebuffed by Salix, according to a source.

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