Company Reiterates Value of Barr/PLIVA Combination for Shareholders,
Employees, and Croatia
WOODCLIFF LAKE, N.J., June 30 /PRNewswire-FirstCall/ -- Barr
Pharmaceuticals, Inc. (NYSE: BRL) today announced that the Company has
increased its offer to purchase 100% of the shares of PLIVA d.d. (LSE:
PLVD; ZSE: PLVA-R-A) based in Zagreb, Croatia to approximately $2.3 billion
in cash. Under the terms of its enhanced proposal, PLIVA shareholders who
tender their shares will receive HRK 743 per share in cash, which equates
to approximately $25.73 per each Global Depositary Receipt at current
exchange rates. In addition, tendering shareholders will receive the
dividend of approximately HRK 12 per share, for a total cash consideration
of HRK 755 per share or $26.15 per each Global Depositary Receipt.
On June 27, 2006, Barr announced that the Supervisory Board of PLIVA
had endorsed Barr's initial proposal to make a tender offer to PLIVA's
shareholders to purchase 100% of the shares of PLIVA for HRK 705 per share
or approximately $2.2 billion in cash.
"As we stated when our initial offer was announced, we believe that
Barr represents the best potential suitor for PLIVA and provides
significant value to PLIVA's shareholders," said Bruce L. Downey, Barr's
Chairman and Chief Executive Officer. "First, we have access to the
necessary capital to successfully complete this transaction and we remain
committed to that purpose. In addition, Barr offers a number of other
strengths that differentiate us from other potential acquirers, including:
the complementary nature of our two businesses; the limited overlap in
products and markets; our commitment to maintain investment in PLIVA
facilities; and our plan to headquarter our European operations in
Croatia."
"We also believe that our offer is strengthened by the opportunity
created by combining Barr's expertise in the U.S. regulatory, legal and
marketing environments with PLIVA's biogeneric capabilities, resulting in
the development of biogeneric products for European and U.S. markets. Our
offer would combine two industry leading R&D groups, resulting in faster
product development across several technology platforms including solid
dosage forms, extended/delayed release tablets, orally disintegrating
tablets, creams/ointments, injectables, biopharmaceuticals and API
capabilities. Finally, we offer the best opportunity for utilizing the
skills and expertise of PLIVA management and employees. We are confident
that our offer, as well as our commitment to maximize PLIVA's capabilities
and its facilities, represents the best business option for PLIVA's
employees, the people of Croatia, and investors and shareholders in PLIVA."
Downey continued, "We would like to remind shareholders that all
bidders for PLIVA, including Barr and Actavis Group, must receive
Hart-Scott-Rodino clearance in the United States prior to completing a
tender offer for PLIVA. We anticipate receiving such clearance in the near
term and would move forward with the tender offer process once clearance is
received or sooner. With expeditious clearance, the only condition to our
tender will be acceptances that result in Barr holding more than 50% of
PLIVA's shares. We expect to make our U.S. Federal Trade Commission filing
by July 5, 2006."
The Company also noted that it is constrained from making private
purchases of PLIVA shares because of U.S. antitrust regulations. Barr would
encourage all shareholders of PLIVA not to sell their shares to any
potential acquirer, but rather to allow the public tender process to run
its course. This would permit PLIVA's Supervisory Board and Management
Board adequate time to evaluate all acquisition proposals and make a
recommendation to its shareholders, giving all shareholders of PLIVA the
opportunity to receive an equal and fair price.
Financial Impact
The transaction is expected to be neutral to slightly accretive to the
Company's internal fiscal 2007 earnings estimates and accretive to the
Company's internal fiscal 2008 earnings estimates, excluding synergies and
cost savings, charges associated with the transaction and the impact of
amortization of intangible assets related to this transaction. The Company
expects the combination to generate short-term cost savings and provide
long- term cost benefits reflecting improved manufacturing efficiencies,
lower manufacturing costs, lower product development costs and tax savings.
Net pre- tax cost savings are estimated to be approximately $50 million in
fiscal 2008 and growing to in excess of $100 million by fiscal 2009. In
addition, long- term synergies and cost savings per year are projected to
continue to increase as the Company further utilizes the expanded
capabilities of the combined organization.
The Company intends to finance the transaction and related costs with a
portion of Barr's cash reserves, and new debt of approximately $2 billion
under long-term and short-term facilities. As of March 31, 2006, the
Company had over $600 million in cash and marketable securities and
approximately $15 million of debt outstanding.
About PLIVA d.d.
PLIVA, established in 1921, is a global generic pharmaceutical company
with operations in more than 30 countries worldwide. It is the leading
pharmaceutical company based in Central and Eastern Europe (CEE) and has
been listed on the Zagreb and London Stock Exchanges since 1996. PLIVA
specializes in the development, production and distribution of generic
pharmaceutical products, including biologicals, cytostatics, and other
value-added generics, as well as active pharmaceutical ingredients.
About Barr Pharmaceuticals, Inc.
Barr Pharmaceuticals, Inc., a holding company that operates through its
principal subsidiaries, Barr Laboratories, Inc. and Duramed
Pharmaceuticals, Inc., is engaged in the development, manufacture and
marketing of generic and proprietary pharmaceuticals.
This announcement does not constitute an offer to sell or invitation to
purchase any securities or the solicitation of any vote for approval in any
jurisdiction, nor shall there be any sale, issue or transfer of the
securities referred to in this announcement in any jurisdiction in
contravention of applicable law.
Forward-Looking Statements
Except for the historical information contained herein, the statements
made in this press release constitute forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. Forward-looking statements can be
identified by their use of words such as "expects," "plans," "projects,"
"will," "may," "anticipates," "believes," "should," "intends," "estimates"
and other words of similar meaning. Because such statements inherently
involve risks and uncertainties that cannot be predicted or quantified,
actual results may differ materially from those expressed or implied by
such forward-looking statements depending upon a number of factors
affecting the Company's business. These factors include, among others: the
difficulty in predicting the timing and outcome of legal proceedings,
including patent-related matters such as patent challenge settlements and
patent infringement cases; the outcome of litigation arising from
challenging the validity or non- infringement of patents covering our
products; the difficulty of predicting the timing of FDA approvals; court
and FDA decisions on exclusivity periods; the ability of competitors to
extend exclusivity periods for their products; our ability to complete
product development activities in the timeframes and for the costs we
expect; market and customer acceptance and demand for our pharmaceutical
products; our dependence on revenues from significant customers;
reimbursement policies of third party payors; our dependence on revenues
from significant products; the use of estimates in the preparation of our
financial statements; the impact of competitive products and pricing on
products, including the launch of authorized generics; the ability to
launch new products in the timeframes we expect; the availability of raw
materials; the availability of any product we purchase and sell as a
distributor; the regulatory environment; our exposure to product liability
and other lawsuits and contingencies; the increasing cost of insurance and
the availability of product liability insurance coverage; our timely and
successful completion of strategic initiatives, including integrating
companies and products we acquire and implementing our new enterprise
resource planning system; fluctuations in operating results, including the
effects on such results from spending for research and development, sales
and marketing activities and patent challenge activities; the inherent
uncertainty associated with financial projections; changes in generally
accepted accounting principles; and other risks detailed from time-to-time
in our filings with the Securities and Exchange Commission, including in
our Annual Report on Form 10-K for the fiscal year ended June 30, 2005.
The forward-looking statements contained in this press release speak
only as of the date the statement was made. The Company undertakes no
obligation (nor does it intend) to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise, except to the extent required under applicable law.
[EDITOR'S ADVISORY: Barr Pharmaceuticals, Inc. news releases are
available free of charge through PR Newswire's News On-Call site at
http://www.prnewswire.com/comp/089750.html. Barr news releases and
corporate information are also available on Barr's website
(http://www.barrlabs.com). For complete indications, warnings and
contraindications, contact Barr's Drug Information Department at 1-800-Barr
Lab. All trademarks referenced herein are the property of their respective
owners.]
SOURCE Barr Pharmaceuticals, Inc.
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http://www.barrlabs.com
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CONTACT:
Carol A. Cox of Barr Pharmaceuticals, Inc.,
+1-201-930-3720, ccox@barrlabs.com
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