Tomahawk, WI 11/06/2013 (BasicsMedia) – Endo Health Solutions Inc (NASDAQ:ENDP) which is a specialty pharmaceutical company has come into an agreement to acquire Canadian Paladin Labs for a whopping $1.6 billion. This is one of the plans that Endo health has been trying to accomplish throughout the year as it tries to expand its presences in the ever expanding Canadian market to boost its market share. Once the deal is completed the two companies will fold into one newly formed Irish holding company. The move to buy Paladin Labs by Endo health did not come as a surprise as the company has been performing exemplary well in the market over the past quarters.

Endo health posted good results for the third quarter that essentially boosted its cash balance giving it enough cash to see through the deal in acquiring Paladin Labs. Endo intends to boost its presence both at home and in abroad in an effort of boosting its profit by 2014. Endo according to its official confirmation of the deal expects to save up to $75 million in a year through cost savings. The deal is expected to come to a full conclusion as of the first quarter of 2014 where shareholders are expected to receive 1.6331 shares of stock in the new formed company. The shareholders will also earn an additional 1.16 Canadian dollars in cash for each share held.

 The stock option of the deal is estimated to be worth $71.27 that will essentially translate to a total value of $72.38 per every paladin share. This represents 18% worth of premiums over paladin labs share price of $61.36. Knight Therapeutics is another newly formed company that is being split out of Paladin labs of which shareholders are expected to receive one share of Knight. When the deal closes in the first quarter of 2014 Endo health is expected to own a total of 78% of the newly formed company while Paladin labs shareholders hold the remaining 28% The new company that will be formed after joining Endo health and Paladin labs will be led by the management team at Endo health as it remains the biggest shareholder in the deal. Under the terms of the deal Paladin will be perceived as an independent entity led by its current management team, it will also be allowed to maintain its headquarters in Montreal.

Endo Health Solutions Inc (NASDAQ:ENDP) in the third quarter saw its revenue subside by nearly 25% mainly due to hefty charges related to product charges. The decline revenue was also caused by impairment charges the company incurred during the quarter. The company earned a total of $402 million or 33 cents a share a decline from $53.8 million the same quarter in FY12. Despite all this, the company was able to post total profits of $160.7. The company’s revenue also experienced a decline of 5% from the high of $75.5 million to a low of $715 million. The company exudes confidence that its full year profit will clock the $2.8 billion margin translating to adjusted profits of $4.60 to $4.75 a share.

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