) is now a step closer to completing its acquisition of
Warner Chilcott plc
) with the U.S. Federal Trade Commission (FTC) voting in favor of
the acquisition. Actavis will, however, have to divest certain
The products that Actavis has agreed to divest include
Zenchent Fe, Actavis' generic version of Femcon Fe, pending
applications for the company's generic versions of Lo Loestrin Fe
and Atelvia, and an approved application for Actavis' generic
version of Loestrin 24 Fe. Actavis has a settlement agreement for
its generic version of Loestrin 24 Fe under which the product may
be launched in Jan 2014. All these products will be divested to
The deal, which has received shareholder's approval, should
close shortly once approval from the Irish High Court is obtained
and other customary closing conditions are fulfilled.
Actavis currently holds a Zacks Rank #2 (Buy). We are positive
on the upcoming Warner Chilcott acquisition which makes strategic
and financial sense. The Warner Chilcott acquisition will help
strengthen Actavis' position in the women's health (eight
products) and urology (six marketed products) segments. The
company will also gain a presence in the gastroenterology and
dermatology markets. Additionally, Actavis will gain a pipeline
of 25 candidates including 15 targeting the women's health
The acquisition is expected to be immediately accretive.
Moreover, the acquisition will provide strong operating cash flow
and allow Actavis to de-lever its balance sheet. The tax rate
will also be significantly below current levels.
Currently, companies like
) also look well-positioned with both being Zacks Rank #2 stocks.
ACTAVIS INC (ACT): Free Stock Analysis Report
AKORN INC (AKRX): Free Stock Analysis Report
MYLAN INC (MYL): Free Stock Analysis Report
WARNER CHIL PLC (WCRX): Free Stock Analysis
To read this article on Zacks.com click here.