Actavis Plans Job Cuts, China Expansion for AllerganKelly Gilblom
Actavis Plc, which this month agreed to buy Allergan Inc. for $66 billion, plans to cut employees and expand in China, executives from the companies said.
Actavis Chief Executive Officer Brent Saunders said there are overlaps in corporate functions, including human relations and finance, though he hasn’t yet quantified how many positions will be eliminated.
“There are clearly synergies,” Saunders said in an interview on Bloomberg Television. “That means we’re going to have do some cutting but we’re going to do that very carefully because these are two growing companies.”
The Nov. 17 deal for Allergan will make Actavis one of the world’s 10 biggest drugmakers, with generic and brand-name medicines, along with Allergan’s injection Botox, a treatment for wrinkles.
There’s room to grow Allergan’s products abroad, Allergan CEO David Pyott said after his TV interview -- for example, Botox in China. The company got 81 percent of sales from the U.S. and Europe last year.
Actavis is deciding which parts of the management team to bring in from Allergan, which has few overlapping products with Actavis. “We take a best athlete approach to it,” Saunders said. “We’re viewing this as a combination, not an acquisition.” Pyott and Saunders declined to say what Pyott’s role will be after the deal closes.
“My focus is how do I transition the company?” Pyott said. “We like to say this is like a Formula 1 racecar. We want to hand over this car and the keys to Brent and his team so that they can drive really fast.”
Actavis’s deal with Irvine, California-based Allergan ended a months-long hostile takeover effort by Valeant Pharmaceuticals International Inc. that was led by activist investor Bill Ackman.
Actavis shares rose 2.7 percent to $266.88 at the close in New York. Allergan increased 1.3 percent to $211.81.