Woodcliff Lake pharma firm being acquired in $1.9B deal

New Jersey is a world leader in terms of being home to pharmaceutical companies. That’s not simply a matter of fact. It’s a matter of design. The state has long been a bastion of chemical firms and the government is quick to tout the fact that 15 of the 25 largest firms have major facilities in New Jersey.

The state promotes its attractiveness, crediting the positive business environment and the highly educated workforce in New Jersey as the big drawing cards for these companies. But one can’t discount the influence that history may play.

The size of the pharmaceutical industry and the complexity of the business require that the players remain up to speed with the latest implications of changes in law and regulations in order to be sure that the deals they manage are done properly and effectively.

One recent deal is what spurs this post on the subject. It involves the announced intention of sale of Woodcliff Lake-based Par Pharmaceuticals Companies Inc. According to the announcement, Par Pharma has entered into an agreement to be bought for $1.9 billion. The purchaser is said to be a private equity firm affiliated with TPG Capitals, a global operator with interests in health care.

The terms of the deal reportedly call for TPG to pay Par Pharma shareholders $50 per share in cash. That represents about a 37 percent premium compared to Par’s closing share price as of the middle of last month. But, as is suggested by the word that this is only an acquisition agreement, Par Pharma’s board reportedly has an open door to find a better deal if it can be had. They have until Aug. 24 to see what can be swung.

Some analysts give the sale of Par Pharma a thumbs up. They say the company represents a good acquisition target because its list of in-the-pipeline drugs are expected to deliver strong profits in the face of pressures for low-cost medical treatments and increasing demand from the aging U.S. population.

Source: NASDAQ, “TPG to Acquire Par Pharma for $1.9B – Analyst Blog,” Zacks Equity Research, July 17, 2012

• Our firm handles a variety of business transactional issues. If you would like to learn more about our practice, please visit our New Jersey mergers and acquisitions page.