Yahoo Finance Drugmaker Valeant close to buying Salix - source
By Nadia Damouni
NEW YORK (Reuters) - Valeant Pharmaceuticals International Inc (VRX.TO) is close to a $10.2 billion (7 billion pounds) deal to acquire gastrointestinal drugmaker Salix Pharmaceuticals Ltd (SLXP.O), according to a person directly familiar with the matter.
The agreement with Salix, known for its irritable bowel syndrome drug Xifaxan, for around $160 per share could come as early as next week, the source said on Friday, requesting not to be identified as the matter is confidential.
Spokespersons for Raleigh, North Carolina-based Salix and Laval, Quebec based Valeant declined to comment.
Salix's stock jumped 4.1 percent to $156.97 in afternoon trading on the Nasdaq.
A deal of that size would be the largest ever for Valeant, which lost a takeover contest for Allergan Inc (AGN.N) last year. The usually acquisitive Valeant slowed its buying pace dramatically while it pursued Allergan, and Chief Executive Michael Pearson said last month that it would focus in 2015 on buying smaller, private companies. He did not rule out bigger deals, however.
Valeant's New York and Toronto shares rose more than 2 percent.
CNBC first reported on Friday that Valeant was close to a deal with Salix.
Salix is working with advisers to consider its options in the midst of a management shakeup and inventory issues. Last November, Salix announced that supply levels for Xifaxan and other drugs were higher than it had previously indicated, forcing it to slash its full-year earnings forecast.
British drugmaker Shire Plc (SHP.L) (SLXP.O) as of last week had taken initial steps towards a bid for Salix and was working with advisers on a potential offer, according to people familiar with the matter. Endo International Plc (ENDP.O) has expressed interest but was rebuffed by Salix, according to a source.
Valeant is buying assets from bankrupt cancer vaccine maker Dendreon Corp (DNDNQ.PK) for $495 million, although Valeant also gets $80 million in cash.
(Additional reporting by Rod Nickel in Winnipeg, Manitoba and Greg Roumeliotis in New York; Editing by Marguerita Choy)
