Actavis to buy Warner Chilcott for up to $8.5bn

Selection of different coloured pills and drugs
Image caption Actavis has a manufacturing facility in Devon

US drugs maker Actavis, itself the subject of bid speculation, is to buy Dublin-based Warner Chilcott in a deal worth $8.5bn (£5.6bn) including debt.

The announcement on Monday comes after the two companies said earlier this month that they were in talks about a possible tie-up.

As part of the deal, Actavis is offering $5bn in shares to Warner Chilcott investors.

If the deal clears regulatory hurdles, the company will be based in Ireland.

Actavis's drugs include treatments for deep vein thrombosis, asthma medication and attention deficit. The company has a manufacturing site in Devon.

Warner Chilcott, which has manufacturing facilities in Puerto Rico, Northern Ireland and Germany, focuses on gastroenterology, women's healthcare and dermatology.

The combined company would have annual sales of about $11bn.

"We have set as our strategic corporate objective to build a leading global specialty pharmaceutical company," said Paul Bisaro, president and chief executive of Actavis.

He added: "The combination is commercially and financially compelling, and reshapes the specialty pharmaceutical universe by creating a powerful global competitor."

The takeover, expected to be completed by the end of 2013, has been unanimously approved by the boards of both companies and will generate "substantial" cost savings, the firms said in a joint statement.

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