Valeant comes out a winner after upping its Salix bid to $11.1 billion
Valeant has finally come out a winner.
The Canada-based company beat out leading rival bidder Endo International to secure takeover approval from Salix Pharmaceuticals. Valeant will pay $11.1 billion to purchase the Raleigh, N.C.-based drug maker as Endo drops out of the running.
Valeant (VRX) boosted its offer to $173 a share from $158 after Endo (ENDP) jumped into the race, offering $175 a share in cash and stock. Endo’s offer was less appealing than the all-cash rival bid by Valeant because of the uncertainty about the final value given potential stock price swings.
The win is a redemptive moment for Valeant, which failed in its pursuit of Botox-maker Allergan last year. Allergan (AGN) eventually agreed to be bought by Ireland-based Actavis (ACT) for $66 billion.
Valeant has been on the hunt for growth as it relies on steady acquisitions rather than internal drug development. Salix’s portfolio of gastrointestinal medicines, including Pepcid and Xifaxan for travelers’ diarrhea, brought in sales of $1.13 billion. Salix’s (SLXP) top two drugs Xifaxan and Uceris, which treats colon inflammation, account for over half of the company’s total sales.
The deal is the latest in a string of massive pharmaceutical mergers that kicked off last year and continued into 2015. AbbVie (ABBV) agreed to buy Pharmacyclics for $21 billion earlier this month, and Pfizer (PFE) snapped up Hospira for about $15 billion in February.