Teva Buying Barr in $9 Billion Cash, Debt Deal

> Generic drug company Teva Pharmaceutical is acquiring Barr Pharmaceuticals, the fourth-largest generic drug company in the world, the companies say in a joint statement.

Teva has agreed to pay $7.46 billion in cash and stock and to assume Barr’s net debt of approximately $1.5 billion. The Israeli company expects the transaction to close late this year, posting earnings in the fourth quarter. The purchase price represents a premium of 32 percent on Barr’s average daily closing price on the New York Stock Exchange for the year ending July 16 and a 42 percent premium on that day’s closing price, according to the companies.

Teva says the acquisition will strengthen its position in the U.S. and Europe, expanding its generic and proprietary offerings as well as its biologic product line. The combined company will operate directly in more than 60 countries and employ approximately 37,000 people worldwide. The companies’ 2007 combined revenues were about $11.9 billion.

The combined company will have more than 500 marketed products, more than 200 ANDAs pending with the FDA, annual brand sales of more than $120 billion and approximately 3,700 product registrations pending with regulatory authorities worldwide, primarily in Europe.

The boards of directors of both companies have unanimously approved the transaction. The acquisition is subject to approval by Barr’s stockholders, antitrust notification and clearance in North America and Europe, and other customary conditions.

The agreement may be terminated under certain circumstances — for example, Barr’s board of directors could accept a better, unsolicited offer before approval of the merger by the company’s stockholders. If the merger agreement is terminated under some circumstances, Barr would have to pay Teva a termination fee of $200 million.