Teva proposes to buy rival Mylan for $40 bn

Israeli generic major Teva Pharmaceutical Industries Ltd yesterday proposed a cash-and-stock deal to acquire all of the outstanding shares of the US-based Mylan NV for which it will pay $82 per Mylan share. Teva cash and stock proposal, valued at about $40 billion, provides Mylan stockholders with a substantial premium and immediate cash value.
 
The proposed combination of Teva and Mylan is likely to create a leading company in the global generics space. The combined company would leverage its significantly more efficient and advanced infrastructure, with enhanced scale, production network, end-to-end product portfolio, commercialisation capabilities and geographic reach. With this platform, the combined company would focus on complex technologies and more durable and sustainable products, in combination with robust capabilities in specialty drug development and commercialisation.
 
“As a result, the combined company would have a unique and differentiated business model addressing significant trends and discontinuities prevailing today among patients and healthcare systems around the world. The combined company would also have an enhanced financial profile, creating the opportunity for rapid deleveraging and the funding of future growth – in generics, specialty and the intersection of the two,” said Teva in a press release.
 
The combined Teva and Mylan would have pro forma 2014 revenues of approximately $ 30 billion and pro forma 2014 EBITDA of approximately $ 9 billion.
 
“In 2016, the combined company is expected to have cash flow from operations, excluding one-time restructuring costs, of greater than $6 billion, revenues of greater than $30 billion and EBITDA of greater than $10 billion. In 2018, the combined company is expected to have cash flow from operations of greater than $8.5 billion, revenues of approximately $33 billion and EBITDA of approximately $13 billion,” said Teva in the release.