Ireland-based Endo International has agreed to acquire privately held, Woodcliff Lake, N.J.-based Par Pharmaceutical from TPG for $8.05 billion, including assumption of Par debt. The transaction has been unanimously approved by the boards of directors of both Endo and Par and is supported by the management teams of both companies. There are no further shareholder approvals required.

The purchase price will consist of approximately 18 million shares ($1.55 billion of value based on the 10-day volume-weighted average share price of Endo ending May 15) of Endo equity and $6.5 billion cash consideration to Par shareholders. Endo has secured fully committed financing from Deutsche Bank and Barclays to fund the cash consideration. Endo expects to implement a permanent capital structure to finance the transaction prior to the close that would include a combination of cash, debt and an equity offering.   

"Our generics business, Qualitest, continues to be an extremely attractive and effective growth driver for Endo. This transaction with Par builds upon our generics growth, adding a strong portfolio of high barrier-to-entry and attractive gross margin products while also transforming Endo, creating a powerful corporate platform for future growth and strategic M&A," said Rajiv De Silva, president and CEO of Endo. "We believe the acquisition of Par underscores the continued execution of Endo's value-driven M&A strategy and helps deliver on our goal of achieving double-digit revenue growth for the overall business over the long term."

"This is an exciting time of growth and opportunity in the generics and specialty pharmaceutical arenas. Par Pharmaceutical is committed to significantly expanding our scope, capacity and capabilities to realize the maximum value of our diversified product portfolio and R&D pipeline. We believe our combination with Endo best positions us to do so," said Paul Campanelli, CEO of Par Pharmaceutical. "We share Endo's goal of developing and commercializing generic drugs in areas of greatest revenue potential, complex formulations and longer life cycles."

"Over the last three years, we have enjoyed partnering with the Par team to create a more diversified company with expanded capabilities, an enhanced product pipeline and more robust business development opportunities, all resulting in significant growth," said Todd Sisitsky, managing partner of TPG Capital North America.

Par's product portfolio includes nearly 100 products in multiple dosage forms and delivery systems, including oral solids, oral suspensions, injectables and high barrier-to-entry products. Its pipeline consists of more than 200 Abbreviated New Drug Applications (ANDAs), 115 of which were filed with the FDA as of Dec. 31, 2014. Approximately 33% are potential first-to-file or first-to-market opportunities and 75% of the overall development portfolio consists of Paragraph IV and first-to-file programs—all of which could provide a period of market exclusivity if approved. It is expected that the Par R&D pipeline could generate approximately 20 to 25 ANDA filings each year in 2015, 2016 and 2017.

Given the complementary nature of the companies' generics portfolios and operations, Endo estimates the transaction will generate $175 million in operational and tax synergies that are expected to be realized within the first 12 months following the completion of the transaction, while strategically preserving investment in the R&D pipeline to help drive long-term organic growth.

The transaction is expected to close in the second half of 2015.