NEW YORK, July 16 Billionaire investor John
Paulson on Wednesday called Valeant Pharmaceuticals
International Inc a "very serious acquirer" and
predicted that Allergan Inc cannot rebuff the drug maker
on its own.
Paulson, whose hedge fund Paulson & Co holds a roughly $1
billion stake, or 6 million shares, in Allergan, threw his
weight behind Valeant's bid to buy the Botox maker on Wednesday
at the CNBC Institutional Investor Delivering Alpha Conference.
Allergan traded at $165.50 on Wednesday, having climbed 49
percent this year alone with most of the gains coming after
Valeant's bid was announced. Paulson said Allergan's share price
could rise to $222 a share based on the kind of savings
Valeant's chief executive officer might make.
Paulson called Mike Pearson, Valeant's CEO, a very
cost-conscious executive who has added significant value for
shareholders in the last years.
"He is a proven success," Paulson said. Valeant, working
with activist investor William Ackman, has offered to pay $53
billion for the Botox maker but Allergan has steadfastly
rejected any discussions with Valeant.
The offer, which includes $72 in cash plus 0.83 Valeant
shares, is worth about $177 per share.
Ackman is mounting a proxy battle to try and force
Allergan's board to discuss the Valeant bid and on Wednesday
accused Allergan of violating its fiduciary duty for not
negotiating with Valeant.
Paulson said he would listen to a call on Thursday, hosted
by Ackman, which will focus on Allergan's corporate governance
and other aspects of its business. The call is scheduled for
8:30 a.m. EDT (1230 GMT) and will allow listeners to ask
Paulson said that Allergan could defend against Valeant's
bid but would need to make an acquisition of its own to do so.
"Standing still does not seem to be a plan of action," he said.
Paulson, whose trades have been widely followed ever since
he earned billions by betting against the overheated housing
market in 2007, often bets on companies that may become
(Reporting by Svea Herbst-Bayliss; Editing by Lisa Shumaker)