Pershing Square Boosts Stake In Valeant Pharmaceuticals

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Bill Ackman’s Pershing Square Capital Management boosted his stake in Valeant Pharmaceuticals based on its latest 13D filing with the Securities and Exchange Commission (SEC).

The filing showed that Pershing Square now owns 19,473,933 shares or 5.7% of the outstanding stock of Valeant Pharmaceuticals. Pershing Square previously owned 16,473,933 shares or 4.9% stake in the pharmaceutical company.

Yesterday, Marketfolly first reported that Pershing will its position in Valeant Pharmaceuticals based on careful analysis of a Wall Street Journal article. The WSJ article indicated that the firm will acquire 3 million shares in the company’s recently announced $1.45 billion stock offering.

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Indeed, Ackman’s firm acquired additional 3 million shares of Valeant Pharmaceutical’s common stock on March 17, 2015. Pershing Square purchased its additional stake in the pharmaceutical company for a total price of $597 million.

Pershing Square is confident with Valeant

During a previous interview with CNBC, Ackman said he is confident with Valeant Pharmaceuticals and its CEO Michael Pearson. The activist investor pointed out that he knew Pearson well because they worked together for a year.

In its regulatory filing, Pershing Square reiterated its positive conviction about Valeant Pharmaceuticals and its management team.

“The reporting persons think highly of the Valeant Pharmaceutical’s management team, strategy, and track record,” according to Pershing Square in its filing.

Ackman’s firm also stated that it may continue to conduct discussions from time to time with the company’s management, other stockholders, and relevant parties regarding matters including strategic plans, strategy, assets, business, financial condition, operations, and capital structure.

Pershing Square also expects to engage in discussions with the management of Valeant Pharmaceuticals and other relevant parties regarding strategic acquisitions by or joint ventures with the company or other similar arrangements.

The firm said such discussion would be exploratory in nature; there is no assurance that it would result in a definitive transaction.

Ackman previously described Valeant Pharmaceuticals as the “most disciplined buyer of companies.”

Valeant increases offer for Salix

Last week, Valeant Pharmaceuticals increased its takeover bid for Salix Pharmaceuticals from $158 to $173 per share in cash. The sweetened offer was designed to beat the $175 per share in cash and stock unsolicited counter-offer by Endo International.

It was reported that Valeant Pharmaceuticals partnered with its activist shareholders including Ackman’s Pershing Square and ValueAct Capital to match Endo’s counter offer.

Laurie Little, head of investor relations at Valeant Pharmaceuticals recently said, “We have had a very strong group of shareholders over the years that have included several activists. We welcome the input from our shareholders as they are the true owners of the company and hopefully, we are aligned with them as we strive to deliver strong, long-term shareholder value.”