Teva & Barr… Possible Generic Super-Giant Merger (TEVA, BRL)
Teva Pharmaceutical Industries Ltd. (NASDAQ: TEVA) is reportedly in talks to buy Barr
Pharmaceuticals Inc. (NYSE: BRL). This report is out of Globes, which labels itself as Israel’s Business Arena if you are not familiar with it. The deal terms are listed as “Assuming Teva pays a premium for the firm, its price would be over $5 billion.”
Barr Labs closed up 1.6% today at $46.82, but its market cap at that price is already $5.06 Billion. Shares popped 15% to $54.11 in late after-hours trading after the report came out. That gives a new implied market cap of about $5.8 Billion. Barr’s 52-week trading range is $37.40 to $58.38; and shares were nearly $70.00 at the start of 2006.
The trick to determine is just how much of an “assuming.. above the $5 Billion mark” Teva would be willing to go. Teva’s market cap is nearly $33 Billion based upon a $42.41 close Wednesday.
Stay tuned on this one.
Jon C. Ogg
July 16, 2008