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Watson pays $5.6B to acquire Swiss drugmaker

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Parsippany-based Watson Pharmaceuticals Inc. agreed Tuesday to acquire drugmaker Actavis Group, of Zug, Switzerland, for $5.6 billion, creating the third-largest global generics company in the world with $8 billion in anticipated 2012 revenue.

"In a single, commercially compelling transaction, we more than double Watson's international access and strengthen our commercial position in key established European markets," said Paul M. Bisaro, president and CEO of Watson, in a statement.

Bisaro said once the transaction is complete, approximately 40 percent of Watson's generic revenues will come from markets outside of the United States — an increase from 16 percent of total 2011 revenues. At close, the combined company will employ more than 17,000 across 20 manufacturing facilities and more than a dozen research and development centers in 40 countries.

Watson — which develops the authorized generic version of Pfizer Inc.'s Lipitor cholesterol drug — anticipates closing the transaction in the fourth quarter of 2012, following review by the U.S. Federal Trade Commission, as well as approvals outside of the United States.

Watson intends to fund the cash portion of the transaction — about $5.5 billion — through term-loan borrowings and senior unsecured notes.

In January, Bisaro announced that the company was interested in buying a generic or brand-name drugmaker and expanding its international reach. Actavis currently has approximately 300 projects in its development pipeline, and it announced in December a partnership with Australia-based QRxPharma Ltd. to introduce a new pain medication in the United States.

Write to the Editorial Department at editorial@njbiz.com

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