PLIVA takeover: Actavis will not raise Barr

Actavis, the Icelandic generics manufacturer, has announced that it has decided not to outbid Barr’s $2.5 billion (1.3 billion pounds) offer of 825 Croatian kuna (75 pounds) per share.

The company said that although it still believed it represented the best option for PLIVA shareholders, it would not raise its offer of 795 kuna per share, which it believes to be fair.

Actavis had approached PLIVA with the hope of becoming the world’s third largest generics manufacturer. PLIVA, recently labelled as the fastest-growing pharmaceutical operation in the UK, had said PLIVA’s offer was fair.

However, Barr, an American company with both generic and proprietary products, has said it wished to base its European headquarters in Croatia from where it can launch an assault on the European market. In addition, it vowed to keep the PLIVA name separate.

Actavis, which owns over 20 per cent of PLIVA’s stock, has said it would not rule out entering the bidding again if an opportunity arose and was looking to find other strategic acquisition targets.

Robert Wessman, president and chief executive officer of Actavis, remarked: “While we continue to believe that the combination of our two businesses would create one of the most exciting companies in our industry and a solid platform from which to achieve substantial future growth, we will not compromise our growth plans by overpaying for acquisitions despite very strong synergies.”

Barr had previously rejected claims that its product portfolio was incompatible with PLIVA’s, saying that there was some degree of overlap between those of Actavis and PLIVA.

In addition, Barr has promised additional research and development monies in excess of $230 million.