Does Allergan Deal Create New Phase of Pharma M&A?

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April 22 (Bloomberg) -- Yale Law School Professor Jonathan Macey and Columbia Business School Professor Fabio Savoldelli dig deeper into the structure of the deal for Allergan by Valeant and activist investor Bill Ackman on Bloomberg Television’s “Market Makers.”


How unique and different is this than anything you have seen before.

Qwest it is a major step forward and a great opportunity for the shareholders of both.

It is a terrific innovation.

The bad news is i think the sec will regulate and make this much less profitable.

Qwest when you say it will regulate, are you saying for this deal or future deals?

Future deals.

Lie is this so innovative?

You have never seen before a team up of a -- an investor like bill ackerman, and a company in the same industry as the target.

They are great synergies.

They have difficulties creating credibility.

Companies making outside activity events also have difficulties.

This combination solves a lot of the problems that others have.

Qwest this is potentially a game changer for the way m&a has done.

If all of a sudden, you can go to the hedge fund manager like the lachman instead of a bank -- the ultimate winners, because the lawyers are the ones who will get paid here.

Qwest the lawyers always get paid.

Live show the m&a banker the lawyer?

Lie higher and m&a bank and pay them two percent when he could get this guy put his own money up and do the dirty work.

If an investment bank guys you through the difficult process of all the different filings, and beats up on the board to resign into the governance issue you want, the sport is on annual turnover.

Ackerman will know how to call midway through the year, and he will effectively have an investment banking role.

They are only putting up capital.

They go away and effectively ackerman will shepherd this through the process while the biomedical team and the other side can show clearly -- hold on.

If i'm jamie dimon, and my kicking the behind of my m&a bankers?

Qwest this is an odd case.

There are bankers involved here.

Mostly on the lending of the capital, on the financing side.

I have not seen anyone on the real deal advisor side.

But will end up happening is good firms, he knows his stuff, he will be able to guide you.

Qwest how could this go wrong?

They cannot prohibit it.

There is so much attention on the deal that a real hard-core scorched earth defensive strategy is not likely to work.

Speaking of marty, he is the puppet master which urged to change the rules to make this more difficult.

Qwest that is probably a difficult -- a different conversation.

For the time being, it is unlikely they adopt a poison pill.

Could we then draw the conclusion that no matter what happens, the white knight comes in, whether ultimately valiant has to raise the price, that ackerman wins?


Just so the record is clear, it is not at all clear that allergan will not adopt -- they may.

That will not necessarily be a deal killer.

It will just bring them to the table and make them negotiate.

Qwest it is highly unlikely they exist.

The entire upper east side is thrilled to hear it.

Realistically, they will go out and look for a white night.

In this merger environment, all the talks and deals that went through, white nights are not hard to find.

Stable optics, cosmetology, it is relatively stable stuff and they are willing to pay up a serious amount.

My guess is they will either look for a white night or look for an acquisition or do a financial share buyback.

They are too much in play.

Qwest can you help us understand bill ackerman's investment style?

You have to have some flavor because it seemed like all the investments are i are some level of government action.

He will get us through.

If you're talking fannie and freddie, that is involved in government.

Herbalife did.

. it is so unpredictable.

Qwest in this case, you have got the product overlap against botox and dermal fillers.

Also, both of them have large cosmos of the goal lines, all of which will have to be looked at.

A lot of cosmetic stuff is not regulated.

Qwest correct.

Less likely to be an issue.

Those overlapping is absolutely likely.

Qwest we are a heavy regulatory environment that there will be regulation in whatever anyone does here there is more in the recent areas you identified.

Under current regulations, regulation will not be a deal breaker.

Qwest specialized in in defense, to do a activism.

One of the obstacles they raised was the notion bill ackerman, a hedge fund manager, and cannot be part of a group.

It is not like when they say nasdaq teams up to make a joint bid, in which they both become operators.

Class come on.

Qwest of course.

That is why i'm putting the question to a law professor.

Qwest there is no problem when this deal has been carefully lawyered.

Certainly, bill ackerman is already filed scheduled -- i do not think so.

I do not see it as close to the line.

He has not done anything that implicates a government statute for m&a. qwest this activity has to happen.

The number of drug buyers is getting less and less and therefore cement prices down.

There is overcapacity and inefficient companies and your purchasers are getting more and more powerful.

You are dealing with five major drug buyers.

He has not taken a vacation either.

How about bring break?

He does not take a break.

I am tired.

I want to go to bed on a monday night.

He is into it.

Qwest thank you very much.

Our contributing editor, he will be back with us this next hour.

It will cost you more to sign up for netflix and investors seem to be very happy.

Qwest the center of the world when it comes to movies, it is like my neighborhood.

This is market makers.

We on -- we're on bloomberg television streaming live.


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