NDOI News & Events

Mallinckrodt (MNK) and Endo (NDOI) announced that they have completed their merger to create a global, scaled, diversified therapeutics leader. The combined company is expected to generate at least $150M of annual pre-tax run-rate operating synergies by Year 3, and approximately $75M of pre-tax run rate synergies in the first 12 months post-merger, driven by business function integration and R&D savings from economies of scale, among other areas. Following the spin-off of Par Health, the branded therapeutics company is expected to be listed on the New York Stock Exchange, subject to approval of Mallinckrodt's Board of Directors.

Endo and Mallinckrodt announced that the Irish High Court has given the necessary ruling to enable their combination, advancing the companies' plan to merge in a stock and cash transaction. The Court's ruling is the final substantive legal step required for the transaction and follows a vote by each company's shareholders last month to approve the merger. With these approvals in hand, Mallinckrodt and Endo expect to complete their combination in early August, pending the satisfaction of the remaining closing steps. Mallinckrodt's headquarters in Dublin, Ireland, will serve as the combined company's global headquarters. Mallinckrodt and Endo plan to combine their generic pharmaceuticals businesses and Endo's sterile injectables business after the close of the transaction and to separate that business from the combined company at a later date. The separation would be subject to approval by the combined company's Board of Directors and other conditions.

BWS Financial notes that Endo (NDOI) closed the sale of its international business and that the merger with Mallinckrodt (MNK) is reaching its conclusion. The firm, which argues that Endo's share price is not currently reflecting the value of the combined business and the synergies expected as the two companies combine and then eventually separate their branded and generic businesses, believes shares should trade closer to its $40 price target as free cash flow is applied to cut debt in the first year after the merger is complete. BWS keeps a Buy rating and $40 price target on Endo shares.

Endo yesterday announced that it has completed the previously announced divestiture of its International Pharmaceuticals business, primarily operated through Canada-based specialty pharmaceutical company Paladin Pharma Inc., to Knight Therapeutics Inc. Total cash consideration for the sale is up to approximately $105M, consisting of approximately $79M paid at closing, approximately $11M related to certain permitted holdbacks, and up to $15M in future payments contingent upon the achievement of certain milestones, Endo noted.