Allergan to cut 1,500 jobs as it fights off bid from Valeant

Botox maker Allergan, which is fighting off a hostile bid from Valeant Pharmaceuticals, today announced 1,500 jobs cuts as part of a $475 million restructuring meant to boost profits over the next six years.

But the company did not announce any major acquisition or share-repurchase program moves it had discussed as ways that might bolster its defenses against Valeant and Pershing Square Capital Management.

The job cuts are not expected to have a major impact on the company’s Irish operation, which employs up 900 staff at its main plant in Westport, Co Mayo and a further 50 in Dublin.

“In light of the overall restructuring announcement made by Allergan today, local management in Ireland have confirmed that the headcount impact for the Irish business will be negligible,” a spokeswoman for Allergan Ireland said.

Allergan said the cost reductions, which are part of its efforts to convince investors that it is a better value as a stand-alone company, would help it deliver annual earnings growth of more than 20 per cent between 2014 and 2019.

The 13 percent cut to global headcount will help deliver earnings per share of $5.74 to $5.80 in 2014 and $8.20 to $8.40 in 2015, Allergan said. The company had previously forecast a 2014 profit of $5.64 to $5.73 per share, with earnings growth of 20 per cent to 25 per cent in 2015.

Allergan shares rose 0.3 per cent to $167.94 in premarket trading. The company reported second-quarter earnings of $418 million, or $1.40 per share, compared with $361 million, or $1.22 per share, a year earlier. Excluding special items, Allergan earned $1.51 per share.

Reuters