Pershing Square Forms Joint Entity with Valeant Pharmaceuticals International Inc (VRX) to Acquire Allergan, Inc. (AGN)

Bill Ackman‘s Pershing Square has added Allergan, Inc. (NYSE:AGN) to its equity portfolio. The fund reported a new activist stake, which contains 28.89 million shares, equal to 9.7% of the outstanding stock. According to the filing with the SEC, the fund purchased the shares because it considers that the stock is undervalued and, hence, represents an attractive investment.

Bill Ackman in crowd

Pershing Square plans to engage in discussions with the company’s management and board of directors, as well as other shareholders regarding to Allergan, Inc. (NYSE:AGN)’s governance, board composition, management, operations, and other matters related to the company’s strategic plans and future.

Earlier in February, Pershing Square signed an agreement with Valeant Pharmaceuticals International Inc (NYSE:VRX), under the terms of which the parties agreed to consult with each other regarding their investments in Allergan. The parties agreed to form a joint entity, which will acquire Allergan. Valeant Pharmaceuticals has proposed a merger in which the shareholders of Allergan would receive common shares of Valeant and cash.

In a press release issued today, Valeant Pharmaceuticals International Inc (NYSE:VRX) stated that it has proposed an offer in which Allergan, Inc. (NYSE:AGN)’s shareholders should receive $48.30 in cash and 0.83 shares of Valeant for each Allergan share. The proposition represents a significant premium on Allergans’ stock price, and the shareholders of Allergan will also be able to benefit from the future growth of Valeant.

In addition, the statement said that Valeant Pharmaceuticals forecasts $2.7 billion in annual cost synergies, with 80% achieved in the first six months after the merger.

“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.  We will be electing all-stock consideration in the transaction so that we can remain a long-term holder of the combined company,” the statement quoted Bill Ackman as saying.

Pershing Square is currently the largest shareholder of Allergan, Inc. (NYSE:AGN). Jacob Gottlieb’s Visium Asset Management is another shareholder, which in its latest 13F revealed holding some 2.65 million shares of the company, followed by Ken Griffin‘s Citadel Investment Group with 2.33 million shares.

Disclosure: none

Recommended Reading:

Bill Ackman’s Pershing Square Further Cuts Position In BEAM Inc (BEAM)

Bill Ackman Exercises Warrants and Buys 4 Mln Platform Specialty Products Corporation (PAH) Shares

Bill Ackman’s Equity Portfolio Moves During Q4

blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 44 percentage points in 21 months Learn how!

Lists

The Top 10 States With Fastest Internet Speeds

10 Best Places to Visit in USA in August

Top 10 Cities to Visit Before You Die

Top 10 Genetically Modified Food In the US

15 Highest Grossing Movies Opening Weekend

5 Best Poker Books For Beginners

10 Strategies Hedge Funds Use to Make Huge Returns

Top 10 Fast Food Franchises to Buy

10 Best Places to Visit in Canada

Best Summer Jobs for Teachers

10 Youngest Hedge Fund Billionaires

Top 10 One Hit Wonders of the 90s

Fastest Growing Cities In America

Top 10 U.S. Cities for Freelancers

Top 9 Most Popular Free iPhone Apps

Top 10 Least Expensive Private Business Schools in the US

Top 15 Most Expensive Countries in the World – 2014

Top Businesses to Invest In

Top 5 Things You Might Be Doing Wrong With Your Business

Top 5 Strategic Technology Trends in 2014

Top Rags to Riches Stories

Parenting Behavior That Promotes Future Leaders

Top 5 Mistakes Made by Small Businesses

Top 5 Most Common and Potentially Devastating Financial Blunders

Top 5 Highest Paying Jobs for Web Designers

Top 6 Most Respected Professions that Also Pay Well

Top 5 Pitfalls Investors Should Avoid

Top 6 Lawyers and Policy Makers Under 30

Top 6 New Year’s Resolutions for Entrepreneurs

Top 7 Locations to Check in on Facebook

Top 5 Mistakes made by Rookie eBay Sellers

Top 7 eBook Publishers in 2013

Top 6 Health Industry Trends in 2014

5 Lessons for Entrepreneurs from Seth Godin

Top 5 Success Tips from Jordan Belfort – the Wolf of Wall Street

Best Master’s in Finance Degree Programs

Top 6 Earning Celebrities Over 50

The most expensive sports to play

Top 7 Earning Celebrities Under 25

Best 7 Online Courses to Take: Free Finance MOOCs

Top 6 Bad Habits that Promote Failure

20 Most Valuable Soccer Teams in the World in 2013

12 Most Expensive Countries for Foreign Students

Top 30 Most Influential Women in the World

Top 20 Most Expensive New Year Eve Shows

Top 5 Best Vocational Careers

Top 10 Jobs for 2014 by Salary Gain (Predictions)

Top 5 Digital Trends for 2014

Top 6 Things You Can Do To Increase Your Productivity

Top 9 Trending Smartphones in 2013

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!