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Allergan agrees to $66 billion Actavis deal, Valeant walks: Reuters

(Reuters) – Allergan Inc agreed to be bought by Actavis Plc for US$66 billion, putting an end to a hostile bid by activist investor William Ackman and Canada’s Valeant Pharmaceuticals International Inc.

The offer values Allergan at US$219 per share and is US$6 billion more than the price Valeant had last offered to pay. Valeant said in a statement that it could not justify paying such a high price for Allergan, which makes the Botox wrinkle treatment.

Allergan shares rose 6.6 percent to US$211, earning Pershing Square Capital Management‘s Ackman a payout of more than US$2.4 billion on his nearly 10 percent stake in the company. Valeant’s latest cash-and-stock offer was worth about US$54 billion although it had said it would pay up to US$200 per share, or about US$60 billion.

The deal comes after Allergan spent six months maneuvering against a takeover by Ackman and Valeant. Allergan Chief Executive Officer David Pyott had said shareholders would be hurt because Valeant’s cost cutting would stop its growth and he questioned Valeant’s accounting.

Actavis Chief Executive Officer Brent Saunders will lead the combined company.

A spokesman for hedge fund Pershing Square Capital Management did not have an immediate comment.

Valeant shares dipped 0.6 percent to US$133.47 on the New York Stock Exchange. Actavis rose 3.5 percent to US$252.22.

(Reporting by Caroline Humer; Additional reporting by Rod Nickel in Winnipeg, Manitoba; Editing by Bernadette Baum and Lisa Von Ahn)

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