Watson Completes Actavis Acquisition

- Creates 3rd largest global generics company with presence in 60+ markets - 
- $8.0+ billion anticipated pro forma combined 2012 revenue - 
- Combined management structured to immediately maximize combination value - 
PARSIPPANY, N.J., Oct. 31, 2012 /CNW/ - Watson Pharmaceuticals, Inc. (NYSE: 
WPI) today announced that it has completed the acquisition of the Actavis 
Group for EUR 4.25 billion.  The combination creates the world's third largest 
generic pharmaceutical company, with anticipated pro forma combined 2012 
revenues in excess of $8 billion. 
Watson funded the transaction through a combination of $1.8 billion in term 
loan borrowings and the issuance of $3.9 billion in senior unsecured notes.  
The Company said the transaction is immediately accretive to non-GAAP 
earnings, before synergies.  The Company also noted that the strong cash flows 
of the combined business are expected to permit rapid pay down of debt. 
"Today we unite two powerful, profitable and rapidly growing companies into 
one exceptional global business.  As a result of accelerated integration 
planning, we will immediately begin to maximize the exceptional financial and 
commercial value of this combination," said Paul Bisaro, President and CEO of 
Watson.  "Over the past several months we have defined and communicated 
internally the Global Generics, R&D and Operations and Shared Services 
management structures and today begin operations as a combined company.  We 
also begin the immediate execution of our Day 1 through Day 100 integration 
strategies to support continued growth, while optimizing our global structure 
and capturing our projected synergies.  I am confident that working together, 
the 17,000 people of our new company will now be focused on the seamless 
integration of the company for strong and sustainable growth." 
"With the acquisition complete, we now have the generic assets in place that 
will power our continued organic growth, and generate strong cash flow to 
support the rapid pay-down of debt, which will allow us to continue to focus 
on future investments to enhance all of our businesses, particularly our 
Global Brands and Biosimilars businesses.  Watson plans to host Investor Day 
2013 in January to provide a more comprehensive review of the combined 
business." 
Significant Synergies Expected 
Watson continues to expect $300 million in annual cost synergy savings from 
the Actavis acquisition within three years.  These synergies are comprised of 
SG&A, R&D, corporate, purchasing and raw material supply savings. 
Transaction Financing Favors Rapid Deleveraging 
The acquisition was funded through a combination of $1.8 billion in term loan 
borrowings at an average rate of three-month libor plus 150 basis points and 
the issuance of $3.9 billion in senior unsecured notes. The overall combined 
cost of debt for the acquisition was approximately 2.9 percent.  The combined 
company is expected to generate strong free cash flow in 2013, which favors 
rapid deleveraging. 
Review of the Benefits of the Acquisition 
This acquisition combines two growing, successful and highly profitable 
companies, and substantially completes Watson's expansion as a leading global 
generics company.  The combined Company begins operations with a defined 
global management structure and aggressive integration execution strategies in 
place to focus on organic growth and rapid achievement of synergies. 
Expanded Global Geographic Footprint 
The combined company has operations in more than 60 countries, with top 10 
positions in more than 33 markets including the U.S., U.K., Canada, Australia, 
Nordics and Russia. With this global footprint, the combined company has an 
extensive platform for strong, future organic growth.  The strongest growth 
regions for the new company will be the U.S., Central and Eastern Europe and 
Russia and in Southeast Asia and Australia.  The Company is also the fastest 
growing generic pharmaceutical company in Western Europe, where growth is 
outpacing the overall market.  The combined company will be geographically 
diverse, with approximately 40 percent of its revenues coming from outside of 
the U.S. 
Expanded Portfolio and Development Pipeline 
The combined Company has an industry leading global product portfolio of over 
750 molecules offered in more than 1,700 different combinations and dosage 
forms.  The Company also has expanded its core leadership position in oral 
solid modified release and transdermal products, as well as semi-solids, 
liquids and injectables.  The U.S. pipeline includes approximately 180 unique 
ANDAs pending at the FDA, including 47 First-to-Files, of which we believe 
over 30 are exclusive.  Outside of the U.S., the current pipeline includes 
more than 2,000 marketing authorizations pending approval and, globally, 
greater than 600 new development projects are underway covering multiple 
dosage forms. 
Expanded Global Supply Chain 
The Company has an expansive, diversified global supply chain with various 
technological capabilities, including the ability to manufacture more than 40 
billion dosages worldwide.  The combined company has the expertise to develop 
solid dosage, modified release, patch, gel, liquid, semi-solid and injectable 
products for all of its global markets. 
Conference Call and Webcast Information 
Watson plans to discuss the close of the acquisition on its third quarter 
earnings conference call scheduled for November 1, 2012 at 8:30 a.m. Eastern 
Time. 
The dial-in number to access the call is (877) 251-7980, or from international 
locations, (706) 643-1573.  The Conference ID is 37197625. 
A taped replay of the conference call will also be available beginning 
approximately two hours after the call's conclusion and will remain available 
through 12:00 midnight Eastern Time on November 15, 2012.  The replay may be 
accessed by dialing (855) 859-2056 and entering the same Conference ID above.  
From international locations, the replay may be accessed by dialing (404) 
537-3406.  To access the webcast, go to Watson's Investor Relations Web site 
at http://ir.watson.com. 
Additional resources are available at 
www.multivu.com/mnr/58370-watson-pharmaceuticals-acquires-actavis-group. 
About Watson Pharmaceuticals, Inc. 
Watson Pharmaceuticals, Inc. (NYSE: WPI) is a global, integrated specialty 
pharmaceutical company focused on developing, manufacturing and distributing 
generic, brand and biosimilar products.  The Company has global and U.S. 
headquarters in Parsippany, New Jersey, USA, and international headquarters in 
Zug, Switzerland. 
Watson is the world's third-largest generics manufacturer, with more than 750 
products marketed globally through operations in more than 60 countries.  
Watson's global branded pharmaceutical business develops and markets products 
principally in Urology and Women's Health, and is committed to developing and 
marketing biosimilars products in Women's Health, Oncology and other 
therapeutic categories.  In addition, Watson is the fourth-largest U.S. 
generic pharmaceutical product distributor through its Anda, Inc. business, 
and also develops and out-licenses generic pharmaceutical products outside of 
the U.S. through its Medis third-party business. 
For press release and other company information, visit Watson Pharmaceuticals' 
Web site at http://www.watson.com. 
Forward-Looking Statement 
Statements contained in this press release that refer to Watson's estimated or 
anticipated future results or other non-historical facts are forward-looking 
statements that reflect Watson's current perspective of existing trends and 
information as of the date of this release. For instance, any statements in 
this press release concerning prospects related to Watson's strategic 
initiatives, product introductions and anticipated financial performance are 
forward-looking statements. It is important to note that Watson's goals and 
expectations are not predictions of actual performance. Watson's performance, 
at times, will differ from its goals and expectations. Actual results may 
differ materially from Watson's current expectations depending upon a number 
of factors affecting Watson's business. These factors include, among others, 
the inherent uncertainty associated with financial projections; successful 
integration of the Actavis acquisition and the ability to recognize the 
anticipated synergies and benefits of the Actavis acquisition; the difficulty 
of predicting the timing and outcome of pending or future litigation and 
government investigations and risks that an adverse outcome in such litigation 
or investigations could render Watson liable for substantial damages or 
penalties; risks that resolution of patent infringement litigation through 
settlement could result in investigations or actions by private parties or 
government authorities or agencies; the impact of competitive products and 
pricing; risks related to fluctuations in foreign currency exchange rates; 
periodic dependence on a small number of products for a material source of net 
revenue or income; variability of trade buying patterns; changes in generally 
accepted accounting principles; risks that the carrying values of assets may 
be negatively impacted by future events and circumstances; the timing and 
success of product launches; the difficulty of predicting the timing or 
outcome of product development efforts and regulatory agency approvals or 
actions, if any; risks and uncertainties normally incident to the 
pharmaceutical industry, including product liability claims and the 
availability of product liability insurance on reasonable terms; market 
acceptance of and continued demand for Watson's products; difficulties or 
delays in manufacturing; the availability and pricing of third party sourced 
products and materials; successful compliance with governmental regulations 
applicable to Watson's facilities, products and/or businesses; changes in the 
laws and regulations, including Medicare, Medicaid, and similar laws in 
foreign countries affecting, among other things, pricing and reimbursement of 
pharmaceutical products and the settlement of patent litigation; and such 
other risks and uncertainties detailed in Watson's periodic public filings 
with the Securities and Exchange Commission, including but not limited to 
Watson's Annual Report on Form 10-K for the year ended December 31, 2011 and 
Watson's Quarterly Report on Form 10-Q for the period June 30, 2012. Except as 
expressly required by law, Watson disclaims any intent or obligation to update 
these forward-looking statements. 
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-0- Oct/31/2012 23:31 GMT