Breakingviews

Overdue Mylan deal is not the one investors wanted

February 11, 2016

Three months after rival Perrigo refused its $26 bln offer, the drugmaker has agreed to buy Sweden’s Meda AB. Though the $7.2 bln transaction makes strategic sense, the 92 pct premium is hard to justify. Mylan might have been better served by trying to sell, rather than buy.

Glaxo self-help looks better than surgeon’s knife

February 3, 2016

The UK pharma group has come under pressure to split itself up after weak performance. Latest results show Glaxo is coming to terms with its challenges. A breakup wouldn’t create much value, absent a premium bid. That gives Chief Executive Andrew Witty breathing space.

Alere board’s diligence brings 51 pct premium

February 1, 2016

A $5.8 bln sale to $56 bln healthcare group Abbott caps a series of good decisions. Appointing a separate chairman, jettisoning Alere’s deal-hungry founder, rejecting his low-ball bid and focusing the business all helped. It shows what engaged investors and directors can achieve.

Shire’s merger with Baxalta looks a little peaky

January 11, 2016

The drugmaker’s Chief Executive Flemming Ornskov has clinched his deal to buy haematology specialist Baxalta for $35 billion. The deal brings Shire scale in rare diseases, but offers few cost synergies, plenty of risk and relies on revenue growth that may be optimistic.

Healthcare M&A will wear down in 2016

January 4, 2016

Obamacare and tax avoidance spurred over $550 bln of U.S. deals in 2015. That’s three times more than the previous record. With the obvious combinations already struck, acquisitive companies hurting and trustbusters sharpening their pencils, a repeat will be challenging.

Valeant’s latest fix reinforces its challenges

December 28, 2015

The $38 bln drug company is handing the reins to three execs while CEO Mike Pearson is on medical leave. And three directors will “oversee and support” them. The double triumvirate shows how reliant on one man Valeant now is as debt, R&D and strategy issues take center stage.

Sanofi and Boehringer scratch each others’ backs

December 15, 2015

The French pharma group is swapping its animal health business for the consumer arm of the German company. The 23 billion euro deal helps both while avoiding the risk of expensive M&A. Boehringer may have a marginally better deal, but Sanofi’s need is probably greater.

Cox: Two signs of M&A bacchanal’s last hurrah

December 1, 2015

The boom just topped $4 trln, helped along by one telltale massive deal and another much smaller one. Pfizer’s takeover of Allergan is clearly predicated on exploiting tax loopholes while a U.S. retailer is getting into the pizza racket. Both indicate a cycle well past its peak.

Pfizer’s war chest stealthily rebuilt by Allergan

November 25, 2015

The $160 bln mostly stock deal will create a combination gushing $25 bln of operating cash flow annually. An offshore tax address means there’s no reason to keep over $60 bln of cash on its balance sheet. That’s a lot of financial firepower to buy back shares and fuel more M&A.

Delay in Pfizer split is material adverse event

November 24, 2015

The $160 bln acquisition of Allergan will cut taxes and add solid assets, but it’s also causing Pfizer to defer until 2018 a decision on splitting up. Even though the company’s disposals have added greater value than acquisitions, CEO Ian Read seems more eager to bulk up.