Filed by Forest Laboratories, Inc.
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12
of the Securities Exchange Act of 1934
Subject Company: Forest Laboratories, Inc
Commission File No.: 1-5438
Set forth below is an e-mail and accompanying attachment sent on March 27, 2014 to employees of Forest Laboratories, Inc.:
Attached please find the first issue of the Actavis + Forest Integration Update newsletter, designed to help keep you informed throughout the integration planning process. Issue One includes a message from Brent and Paul, insight into the creation of a new specialty pharma leader, an overview of integration planning, a snapshot of the A + F combined key products portfolio, plus a Q&A section.
Integration Update
Actavis and Forest Team Members,
On February 18th, we announced the historic, proposed combination of Actavis plc and Forest Laboratories, Inc.
In communications to employees, customers, the media, analysts and shareholders, we highlighted the combinations potential to elevate Actavis to become one of the worlds largest specialty pharmaceutical companies, with more than $15 Billion in total revenues and a growing $7 Billion North American Specialty Brands business. We also talked about the creation of a new model in specialty pharmaceutical leadership, where total revenues are expected to be nearly evenly contributed by our global generics and specialty brands portfolios.
The business and financial communitys response has been overwhelmingly positive, with widespread recognition of the many benefits of the combination. Jami Rubin from Goldman Sachs summarized the transaction: The pro forma ACT/FRX would feature a diverse portfolio of long-lived assets, strong cash flow, balance sheet flexibility and in our view, one of the best management teams in pharma.
Marc Goodman with UBS Equities wrote, Management sounds very excited about the new specialty generic/brand hybrid biz-model that originates from generic DNA but believes in offering brands, branded generics, and generics products on a global basis.1
Currently, management teams from both Actavis and Forest are working together to plan the integration strategies for combining our two companies to enable us to begin operating as one company when the transaction closes, which is expected in the middle of this year. Until then, our two companies will continue to operate separately with a business as usual attitude and continue to focus on meeting our individual commitments to our respective stakeholders and customers.
We are committed to keeping all Actavis and Forest employees informed. You will receive information about transaction milestones and integration planning through this publication as well as through memos, local Town Hall meetings and management presentations. We also welcome you to submit your questions and share your feedback at Connect@ourwinningway.com.
We hope you share our excitement about the potential of this combination to transform both of our companies into a single, leading global specialty pharmaceutical powerhouse.
Sincerely, | ||||
Paul M. Bisaro |
Brent Saunders | |||
Chairman and CEO, Actavis | CEO and President, Forest Laboratories, Inc. |
1 | Permission to use quotations neither sought nor obtained |
Creating a New Business Model for Actavis + Forest:
The Transformation to Global Specialty Pharmaceuticals
Global healthcare continues to evolve in response to rising costs, service demands and expanding populations. These dramatic and ongoing changes are requiring pharmaceutical companies to re-evaluate their business models in order to stay relevant in the global healthcare market.
Over the last three years, Actavis, which had primarily been a global generics company, has been working to transform itself into a leading global, integrated specialty pharmaceutical company. The specialty pharmaceuticals model is focused on ensuring that Actavis can serve as an all-service healthcare provider offering both an extensive generics and specialty brands portfolio.
Geographic size and diverse product offerings are already a strength for Actavis, particularly in global generics. In October 2013, Actavis took dramatic steps to bolster its brand business with the acquisition of Warner Chilcott plc. The combination more than doubled the size of Actavis Pharmas specialty brands portfolio, principally marketed in the United States and Canada, and strengthened its industry-leading pipeline to more than 25 products in various stages of development.
Forest Laboratories, meanwhile, has built a strong legacy in North American branded specialty and primary care pharmaceuticals with a best-in-class commercial team, a top-notch drug development organization and a long history of successful partnerships.
By combining our two companies, we create a specialty pharmaceuticals leader and become more relevant to key physicians and customers throughout the world by offering blockbuster branded franchises in CNS, Womens Health, GI and Urology, and other therapeutic categories, as well as a well-established industry-leading generics business.
Actavis + Forest Combined Key Products Portfolio
Strategies for Success Integration Planning Underway
We anticipate that the transaction will close around mid-year, 2014. In order to ensure the seamless combination of Actavis and Forest on Day 1, we have formed an Integration Leadership Group. This Group, which held its initial meeting on February 27th, has two key objectives: ensure that our two companies, operating independently until close, meet all of the objectives that we have each established prior to the announcement; and meticulously plan for the combination, ensuring that we capture all of the energy, skills and talent of both organizations, and unite the teams at closing in a way that delivers immediate and long-term growth for the combined business.
Office of the Chairman
Integration planning also includes a new Office of the Chairman. Led by Paul Bisaro, Actavis Chairman and CEO, and including Brent Saunders, Forest President and CEO, and Siggi Olafsson, President, Actavis Pharma, the Office of the Chairman will ensure that integration planning activities do not interfere with the independent operation of Actavis and Forest, while working together to establish the leadership structure that will manage the combined business, post close. Paul, Brent and Siggi will work cooperatively to select the combined companys leadership from the all-star team of exceptionally experienced and talented executives within both companies.
Integration Leadership Group
In addition to the Office of the Chairman, we have also defined the Integration Leadership Group that will jointly direct integration planning initiatives. Both Actavis and Forest management teams are equally represented in this task force. Each of these teams will focus on their respective business functions, to ensure that we are prepared to combine the business with minimal to no interruption for our customers, and to ensure value creation for all of the shareholders and employees in the combined company.
Integration Leadership Group
Whats Next?
Integration planning teams will continue work to define the strategies and structure for the combination of our two businesses. At the same time, senior management will continue to work with governmental agencies in seeking regulatory clearance for the transaction close. The transaction is also subject to shareholder approval from both companies and we anticipate those votes to occur sometime in late spring. More information on these and other transaction milestones will be communicated through this publication, on company intranets, and through memos and management presentations.
Q&A
Q: | Will there be employee layoffs as a result of this acquisition? |
We appreciate that any acquisition creates feelings of uncertainty and that this transaction will inevitably bring some change to our organization as a whole, which could potentially impact Actavis and Forest employees. Actavis remains committed to being a good employer and acting accordingly with all employees. Following the closing, Actavis is committed to communicating information related to integration, and what, if any, impact that might have on individual positions or operations. Further, Actavis will communicate with collective bargaining representatives and follow consultation processes, if applicable.
Q: | What do you expect of employees Actavis or Forest during the period between announcement and closing? |
The employees of each company must focus on business as usual, to ensure that we do not lose momentum during the period between the announcement of this merger agreement and the closing of the transaction. During this period between announcement and closing, some employees may be asked to participate on the teams that will support the integration planning process. Actavis and Forest employees should continue to look at the news of this acquisition as an exciting opportunity to expand our capabilities and products and accelerate our growth.
Q: | What happens if the deal does not close? |
What happens if one of the regulatory authorities does not approve the deal? |
Both companies, as part of the due diligence process prior to the announcement, have assessed the potential risks that could prevent successful completion of the transaction. We are confident that the acquisition represents a business combination that is in the best interests of consumers around the world, shareholders of the respective companies and our global employees, and meets all legal and regulatory requirements for successful completion. However, if the acquisition fails to close and the agreement is terminated the two companies would continue to operate as separate entities.
Q: | Who will run the combined company? |
It is premature to speculate on the details of the day-to-day management of the combined organization, as the integration planning process is in the early stages. More details of organizational structure will be disclosed as part of the subsequent integration of the two organizations. Actavis management team is working with Forests management to ensure that the combined organization benefits from the expertise of both global employee teams.
Actavis Administrative Headquarters | Forest Laboratories, Inc. Headquarters | |||
Morris Corporate Center III | 909 Third Ave. | |||
400 Interpace Parkway | New York, NY 10022 USA | |||
Parsippany, NJ 07054 USA | NYSE: FRX www.FRX.com | |||
NYSE:ACT www.actavis.com |
Important Information for Shareholders and Investors
Actavis Administrative Headquarters | Forest Laboratories, Inc. Headquarters | |||
Morris Corporate Center III | 909 Third Ave. | |||
400 Interpace Parkway | New York, NY 10022 USA | |||
Parsippany, NJ 07054 USA | NYSE: FRX www.FRX.com | |||
NYSE:ACT www.actavis.com |