Actavis Plc (ACT), the world’s second-largest generic-drug maker by market value, confirmed early Tuesday it will buy the New York-based pharmaceutical firm Forest Laboratories Inc. (FRX) for about $25 billion.
Under the agreement, Forest shareholders will get $89.48 per share, with $26.04 in cash and 0.3306 Actavis shares for each common stock they hold. The per share consideration represents a premium of approximately 25% per share over Forest’s pps, as of the close of trading on Feb. 14, the companies said in a statement.
If successfully completed, the agreement — which is a win for billionaire investor Carl Icahn, who gained a board seat at Forest in 2012 and is the second-largest shareholder with 11.4% of Forest’s shares — will combine two of the world’s fastest-growing specialty pharmaceutical companies, with combined annual revenues of over $15 billion anticipated for 2015.
Shares of Forest Laboratories surged $22.72, or 32%, ahead of the open, while Actavis gained $16, or 9.44%, in NYSE trading, giving the company a market cap of $33.4 billion.