Endo International to acquire Auxilium Pharmaceuticals
DUBLIN — Endo International and Auxilium Pharmaceuticals on Thursday announced that they have entered into a definitive agreement under which Endo will acquire all of the outstanding shares of common stock of Auxilium for a per share consideration of $33.25 in a cash and stock transaction. The boards of directors of both companies have unanimously approved the transaction, which is valued at $2.6 billion, including the repayment and assumption of debt.
"We are pleased to have reached this agreement with Auxilium, which we believe will create value for both Endo and Auxilium shareholders, as well as for patients, customers and employees," said Rajiv De Silva, president and CEO Endo. "By adding Auxilium's complementary commercial portfolio, we believe this transaction is aligned with our strategy of pursuing accretive, value creating growth opportunities. We intend to leverage Auxilium's leading presence in men's health, as well as our R&D capabilities and financial resources to accelerate the growth of Xiaflex and Auxilium's other products. We look forward to working with the Auxilium team to achieve the growth and synergy potential of this compelling strategic combination."
Upon completion of the transaction, Endo's pharmaceutical portfolio will have a broader offering of urology and orthopedic products that are natural complements to its current men's health and pain products. Endo expects to drive increased adoption and enhance the performance of Auxilium's Xiaflex and accelerate development of the product in potential new indications. Endo also intends to leverage its resources to optimize Auxilium's other products, including Testopel and Stendra. Endo believes the combined company will be well positioned to drive organic growth across its portfolio and to capitalize on additional future strategic M&A opportunities.
Immediately prior to the entering into the merger agreement with Endo, Auxilium terminated its proposed merger agreement with QLT, in accordance with the terms of the QLT merger agreement.
The transaction is expected to close in the first half of 2015 and is subject to the approval of Auxilium's stockholders, regulatory approval in the United States and certain other jurisdictions, and other customary closing conditions.
The per share consideration represents a premium of 55% to Auxilium's closing price on Sept. 16, the day Endo made public its proposal for Auxilium. Subject to aggregate cash and equity consideration limits, Auxilium stockholders may elect one of three options with respect to transaction consideration: 100% equity which equates to 0.488 Endo shares per Auxilium share, 100% cash which equates to $33.25 per Auxilium share or a standard election of an equal mix of $16.625 in cash and 0.244 Endo shares per Auxilium share. The total cash consideration will not exceed 50% of the total equity value and the equity consideration will not exceed 75% of the total equity value.
Citi served as financial advisor to Endo, Lazard provided an independent fairness opinion and Sullivan & Cromwell served as legal advisor. Deutsche Bank served as lead financial advisor, Morgan Stanley served as financial advisor and Willkie Farr & Gallagher and Morgan, Lewis & Bockius served as legal advisors to Auxilium.