Actavis is downplaying talk of a buyout after media reports last week highlighted its primary shareholder's financial troubles. But the denials are vague, and the company does admit having hired Merrill Lynch to analyze its options, which could include a sale or merger.
As you know, Actavis is 80 percent-owned by the private equity firm Novator, an investment vehicle controlled by Icelandic tycoon Thor Bjorgolfsson. In all the recent financial turmoil, Bjorgolfsson lost a bundle on Landsbanki, one of the banks taken over by the government. Actavis also carries some $4 billion in debt, which was recently renegotiated.
A company spokeswoman said that people should be "focusing on other things," and that "there is not a lot of cash available." And it's true that the credit crunch could make a deal difficult to do. But that's not the same thing as saying that the company's not for sale. Likewise, Novator said there is "no sales process underway," but it makes clear that it reviews "all its investments" and looks for opportunities to "maximise value." Sources close to the company said that a sale is unlikely before late next year in any event. We'll keep you posted.
- see the Financial Times story