Watson to double international access through acquisition of Actavis Group

Watson Pharmaceuticals has entered into a definitive agreement to acquire Actavis Group for approximately €4.25bn upfront. The deal will make Watson the third largest global generics company with an expected pro forma revenue in 2012 of approximately US$8bn (€6bn).

Actavis has more than 10,000 employees worldwide and had 2011 revenues of approximately $2.5bn (€1.9bn). The company has approximately 300 projects in its development pipeline and has a commercial presence in more than 40 countries. It markets more than 1,000 products globally and manufactured more than 22 billion pharmaceutical doses in 2011.

‘The acquisition of Actavis will create the third largest global generics company, substantially completing Watson's expansion as a leading global generics company,’ said Paul M. Bisaro, president and ceo of Watson. ‘Actavis dramatically enhances our commercial position on a global basis and brings complementary products and capabilities in the United States.’

With this transaction, Watson's international revenues are expected to increase from approximately 16% of total generic net revenues at the end of 2011 to approximately 40%. The combined company will hold a top 3 position in 11 markets and a top 5 market position in 15 markets. Actavis's leading market positions in key established commercial markets and emerging markets in Central and Eastern Europe and Russia complement Watson's position in established markets including the UK, France and Australia.

Watson expects to achieve annual synergies of $300m (€227m) within three years, and additional longer-term cost synergies related to optimising the supply chain and product launches in new markets. The combined company will have more than 17,000 employees globally, approximately 20 manufacturing facilities and more than a dozen r&d centres.

‘The transaction achieves Watson's stated strategic objective of expanding and diversifying our business into a truly global company,’ Bisaro said. ‘Once the transaction is completed, approximately 40% of our generic revenues will come from markets outside of the US.’

‘The two companies are an ideal complementary fit that will enable the combined company to enhance its position among the industry leaders,’ added Claudio Albrecht, executive chairman and ceo of Actavis. ‘Building on this strong foundation, the combination of Watson and Actavis will result in a company of the size required to position itself as a strong player in the generic pharmaceutical industry.’