AbbVie to Complete $63 Billion Allergan Acquisition with Aesthetics Business Spin-off

On January 8, AbbVie announced that it would establish a new global business unit, Allergan Aesthetics, following the completion of its acquisition of Allergan. The acquisition is expected to be completed in the first quarter of this year.

Allergan Aesthetics will operate as a new global specialty company, primarily focused on leading medical aesthetic products, including BOTOX® cosmetic products, JUVEDERM®, and COOLSCULPTING® from the current Allergan portfolio.

The company’s global headquarters will be located in Irvine, California, under the leadership of Carrie Strom, currently Senior Vice President of Allergan Aesthetics in the United States. Upon completion of the acquisition, she will become Senior Vice President of AbbVie and President of Allergan Aesthetics, overseeing the new company’s global operations and reporting directly to Richard A. Gonzalez, Chairman and Chief Executive Officer of AbbVie.

Allergan’s eye care and specialty pharmaceuticals businesses—including Botox therapeutic products, central nervous system, women’s health, and gastrointestinal products—will be integrated into AbbVie’s existing organizational structure. According to AbbVie, several Allergan executives have accepted new roles in the combined organization.

According to AbbVie’s announcement today, Richard A. Gonzalez will continue to serve as Chairman of the Board and CEO of the combined company, while Carlos Alban will remain Vice Chairman and Chief Commercial Officer.

On June 25 last year, AbbVie and Allergan announced that the two companies had signed a definitive transaction agreement, under which AbbVie would acquire Allergan through a cash-and-stock transaction. Based on AbbVie’s closing price of $78.45 per share for its common stock on June 24, the equity value of the transaction was approximately $63 billion.

The post-acquisition spin-off plan announced this time has also drawn industry attention and speculation. Allergan’s Botox, with annual sales exceeding $3 billion, represents the primary attraction for AbbVie’s acquisition, while its eye care and specialty pharmaceuticals businesses can help offset the anticipated losses AbbVie faces from the patent expiration of its best-selling product, Humira.

Some foreign media outlets suggest that spinning off medical aesthetic products into a separate subsidiary could facilitate future sales. Last year, Novartis’s eye care company, Alcon, was already spun off and listed independently.

Original Title: AbbVie’s $63 Billion Acquisition Nears Completion, Allergan’s Business Split in Two!