Ackman, Valeant Team Up to Pursue Takeover of Allergan
Valeant, Allergan Each Worth More Than $40 Billion
William Ackman and Valeant Pharmaceuticals International Inc. VRX.T +3.21% are teaming up to try to buy wrinkle-treatment Botox maker Allergan Inc., AGN +6.03% according to people familiar with the matter, in a unorthodox alliance between an activist investor and corporate acquirer.
Mr. Ackman's Pershing Square Capital Management LP has built a nearly 10% stake in Allergan, according to people familiar with the matter, worth about $4 billion and representing his biggest investment ever, the people said.
The two companies, both midsize in the pharmaceutical industry, have market capitalizations of more than $40 billion. Any offer for Allergan would likely come with a premium above $116 a share, the price Allergan traded at before Pershing Square began rapidly building its stake, said one of the people.
The stock last traded at that price around April 10. On Monday, shares closed up 6% at $142.
The offer would likely be a combination of cash and stock, the person said, and Pershing Square would maintain a stake in the combined company.