Allergan to cut about 1,500 jobs to evade Valeant takeover
Irvine-based Botox-maker Allergan will cut about 13% of its workforce - that’s 1,500 employees - as it restructures and aims to boost profits.
Allergan Inc., the maker of the wrinkle remover Botox, will cut 1,500 jobs and eliminate another 250 vacant positions as it tries to fend off a hostile takeover from Valeant Pharmaceuticals International Inc.
The job cuts, representing 13 percent of Allergan’s global workforce, and further restructuring will lead to savings of about $475 million next year, the Irvine, California-based company said in a statement today.
Allergan’s second-quarter net income was $417.2 million, or $1.37 a share, the company said, compared to $352.7 million or $1.17 a share a year earlier. Earnings per share excluding one- time items was $1.51 a share, beating by 7 cents the average estimates of 19 analysts compiled by Bloomberg.
“With continuing strong momentum, Allergan recorded the strongest increase in absolute dollar sales in any quarter in our history, and again delivered sales and earnings per-share growth above the high end of our expectations,” Chief Executive Officer David Pyott said in the statement.
Bill Ackman’s hedge fund Pershing Square has teamed with Valeant in its bid to buy Allergan, amassing 9.7 percent of the drugmaker’s shares. Valeant, of Laval, Quebec, has twice raised its offer, with the latest including $72 cash and 0.83 of a Valeant share. At $54 billion, this would be Valeant’s largest deal, eclipsing its $8.7 billion purchase of eye care company Bausch & Lomb Inc. last year.
Allergan has repeatedly rejected Valeant’s terms as inadequate.
