Faber: Valeant to make $45B+ hostile bid for Allergan

David Faber reports Valeant (VRX) will make a $45B+ hostile bid for Allergan (AGN), of which 1/3 will be financed with cash. He expects an announcement tomorrow.

After factoring a 6% gain in regular trading a 19.7% AH gain, Allergan is currently worth $50.9B. Valeant is worth $46.4B, after accounting for a 3.2% gain in regular trading and a 10.3% AH gain.

Valeant and Bill Ackman's Pershing Square Capital have each filed 13Ds (I, II) stating Pershing Square now has a 9.7% stake in Allergan.

Valeant says it expects to propose a merger with a ~$15B cash component, and that it's contributing $75.9M in working capital to an entity (known as PS Fund 1) to be used by Valeant and Pershing to pursue their bid.

Faber: "So Ackman can buy $3b in [Allergan] stock, which he will sell to [Valeant] for a lot more if it succeeds in an offer Ackman knew was coming."

Previous: Valeant and Ackman eye Allergan

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Comments (5)
    , contributor
    Comments (22) | Send Message
    how is this even close to being legal is what I want to know
    21 Apr 2014, 06:00 PM Reply Like
  • The_Hammer
    , contributor
    Comments (5141) | Send Message
    Nothing surprises anymore as the financial system is so freaken broken now.
    21 Apr 2014, 08:00 PM Reply Like
    , contributor
    Comments (2) | Send Message
    Dear Liberal,
    I think that Mike Pearson has a lot more to lose than gain by engaging in insider trading with Bill Ackman. In addition, he is one of the most ethical, even if creative, managers you will ever come across. I think you should consider that people worth billions, and who, in the case of Pearson, value their reputation infinitely more than their wealth, may just have not conspired. Allergan is bloated, it is arrogant, and it is losing market share to Pearson. Just maybe Ackman, an activist, was already invested, without knowing anything of Mike Pearson's intentions. I guess you can confirm all of this when the subsequent filings come out, but I can assure you Valeant had the best lawyers globally checking their every move. They didn't get from 800mm to 50 bn in market capitalization by being reckless and engaging in "illegal" activity. I would imagine the exact same for Bill Ackman, but if one co-conspirator is innocent, it by definition implies the same for his or her "co" ... For anybody who may have the wrong impression I hope this adds some value. I have been a Valeant shareholder for many, many years.
    21 Apr 2014, 08:32 PM Reply Like
  • dxu8888
    , contributor
    Comments (25) | Send Message
    And stock rallying for days and another 6% today before the news comes out after hours? Really seems fishy, I hope the SEC catches the inside traders.
    21 Apr 2014, 08:35 PM Reply Like
    , contributor
    Comments (22) | Send Message
    shady period
    21 Apr 2014, 09:52 PM Reply Like
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