By Soyoung Kim
Jan 7 Forest Laboratories Inc is nearing
an agreement to acquire specialty pharmaceutical company Aptalis
Holdings Inc from private equity firm TPG Capital LP for about
$3 billion, a person familiar with the matter said on Tuesday.
A deal announcement could come as early as Wednesday, the
person said, cautioning that negotiations were still being
finalized. The source asked not to be identified because the
talks are confidential.
Forest and Aptalis did not immediately respond to requests
for comment. TPG declined to comment.
Aptalis has a number of drugs that treat cystic fibrosis and
gastrointestinal disorders, and sells its products primarily in
North America and Europe.
Forest was one of the drug companies that held talks with
Aptalis about a possible deal last year as TPG sought an
investment exit by riding a wave of dealmaking in specialty
pharma, Reuters reported previously, based on people familiar
with the matter.
These talks were put on hold when Forest Chief Executive
Howard Solomon announced in May that he would retire, according
to the sources.
In October, Brenton Saunders, former chief executive of
company Bausch & Lomb Holdings Inc, took over as Forest CEO.
With top leadership at Forest restored, talks with Aptalis
TPG was seeking between $3 billion and $4 billion for a sale
of Aptalis, the sources previously told Reuters. It had
registered the Bridgewater, New Jersey-company for an initial
public offering on Dec. 26 in case a deal to sell the company
outright did not materialize.
TPG bought Aptalis, formerly known as Axcan Pharma, for $1.3
billion in 2008 and merged it with Eurand Pharmaceuticals in
Forest had wrangled with billionaire investor Carl Icahn for
years and ultimately struck a deal with him last summer that
averted a proxy fight. It is still facing patent expirations on
several of its biggest drugs, including Namenda, which is
prescribed to improve cognitive function in people with
The patent cliff, and whether Forest can rebuild a strong
pipeline of experimental drugs, are issues that investors
believe the company may address through acquisitions.
Forest shares have jumped 57 percent in the last 12 months,
far outpacing a 23 percent gain for the ARCA Pharmaceutical
Index, largely on hopes Saunders will buy lucrative new
products and maximize sales of existing drugs.
JPMorgan Chase & Co and Evercore Partners Inc
are advising TPG on the deal while Morgan Stanley
is advising Forest.
The Wall Street Journal first reported that Forest is close
to a deal for Aptalis earlier on Tuesday.