Allergan says it has been approached by another party

Botox maker Allergan, which is fending off an acquisition by Valeant Pharmaceuticals, said today that it had been approached by another party regarding a potential transaction.

The company is Actavis, a source familiar with the situation said.

Allergan, which made the disclosure in a regulatory filing earlier today, had said it was looking for acquisitions but has not previously said it had been contacted about a deal.

Valeant and Pershing Square Capital Management, which owns nearly a 10 per cent stake in Allergan, made an offer now worth $55 billion for Allergan at the end of April.

Allergan, which employs 850 people in Westport, has been fighting the takeover and is trying to convince investors that Valeant’s plan for cost-cutting is too extreme and that its shareholders would be better served with Allergan stock than that of Valeant.

Reuters reported in early October that Actavis, which had already reached out to Allergan once in the prior months, was planning a second approach to the company with an offer worth more than $200 per share.

Last week, during a conference call with analysts, Allergan chief executive David Pyott was asked if the company had received an offer from another party besides Valeant. He responded that he could not comment on "any particular market rumour".

Actavis, along with Valeant, is among the most active companies worldwide in M&A in recent years. Formerly known as Watson Pharmaceuticals, it acquired Switzerland-based Actavis in 2012 and took on the Actavis name. Last year, it purchased Irish-domiciled Warner Chilcott for $9.2 billion, including net debt, in a deal that made it an Irish headquartered business.

Valeant, whose cash and stock offer is worth about $182 per share, recently said it was prepared to raise its offer so that it would be worth around $200 per share.

Activist investor William Ackman, who runs Pershing Square, spearheaded calling a special meeting of Allergan shareholders to vote on new board members and on opening discussions about the Valeant deal. Allergan set the date for December 18th.

Allergan shares rose $2.83, or 1.5 per cent, to $192.89, about 6 per cent above Valeant’s offer price, while Actavis gained $5.22, or 2 per cent, to $247.70. Valeant gained 0.3 per cent to $133.37 in New York Stock Exchange trading. – Reuters