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Salix Pharmaceuticals to Buy Santarus for $2.6 Billion

Today, Salix Pharmaceuticals (NASDAQ: SLXP  ) and Santarus (NASDAQ: SNTS  ) announced the companies have agreed that the former will buy the latter for $32 per share, which values Santarus at approximately $2.6 billion. This value represented a 36% premium over Santarus' closing price on November 6 and a 39% premium over its trailing 30-trading day average.

It is anticipated the transaction will close in the first quarter of 2014, and will solidify Salix Pharmaceuticals as the "largest U.S. gastroenterology-focused specialty pharmaceutical company." The announcement guided that the two companies combined would have a 2013 pro forma revenue of $1.3 billion. In addition, the company guided for earnings per share of approximately $3.85 in 2014 and non-GAAP earnings per share of $5.00.

Salix noted its reasoning behind the acquisition was to solidify its lead in the gastrointestinal market. It would also meaningfully diversity its revenue, provided for an attractive financial profile, and should lead to significant opportunities for revenue synergies.

"We are extremely pleased with the Santarus acquisition, which is transformative for Salix both commercially and financially, fulfilling many of our strategic needs while providing immediate and significant accretion in 2014 and beyond," said Carolyn Logan , Salix President and CEO. "We are very pleased to be able to merge our sales forces, combine two complementary product portfolios, expand our pipeline, diversify revenue, access health care providers in primary care, add a significant number of health care prescribers to our called-on universe and to better position Salix for success in the present as well as the future."

For Santarus' part, President and CEO Gerald T. Proehl said, "We believe the timing is right for this strategic combination with Salix, a highly respected company that is uniquely positioned to expand the commercialization of Santarus' marketed products and to continue to advance the development of our pipeline products." He added, "We welcome the opportunity Salix will provide to build on Santarus' success."


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