Allergan Inc Set to Buy Salix Phamaceuticals

Allergan Inc., revealed plans of acquiring Salix Pharameceuticals. Allergan Inc. was in close door discussions with Salix Pharmaceuticals regarding acquisition of the pharmaceutical company and the maker of antibiotic Rifamixin. Spokesmen for both Allergan and Salix kept mum about the rumoured deal. The details as to what the discussions between the two drug companies could not be disclosed yet as it remains confidential. Botox producer Allergan is trying to win over Salix so that the company could ward off an offer from Valeant Phramaceuticals in connivance with Pershing Square, Allergan’s largest shareholder with 9.72 percent, amounting to a total of $53 billion. Salix, on the other hand, stated in July its plan for a merger with Irish subsidiary of Cosmo Pharmaceuticals SpA to relocate the company’s headquarters in Ireland, where taxes are less costly. Salix shareholders did not vote for the merger with Cosmo Pharmaceuticals. Instead, they chose another route: a company takeover, in this case, by Allergan Inc. The Allergan-Salix deal would antagonize Valeant, maker of neurology, dermatology and infectious disease drugs and Pershing Square’s offer. Allergan tries to deflect the offer by getting investors to back its stand-alone plans, which consist of cost cuts and acquiring a company independently. Allergan executives would talk with Pershing Square on Dec. 18 regarding the offer made by Valeant last April. Moreover, it is reported that Pershing’s Bill Ackman will try to dislodge Allergan board members from their positions and replace them with people who will welcome and favour Valeant’s offer. On another note, Allergan filed a civil lawsuit against Valeant and Ackman of allegedly disregarding securities laws by spying on Allergan to obtain information as they prepared a takeover offer for the company. Currently, Allergan is headed towards being an independent company and likewise turned down a recent takeover offer from another Pharmaceutical company, Actavis Plc.