(Reuters) - Valeant Pharmaceuticals International Inc (VRX.TO) is abandoning its growth-by-acquisitions strategy for the time being to try to reduce debt, boost its stock price and one day return to its traditional deal-making in a stronger position, people familiar with the matter told Reuters.
After spending $19 billion on 40 acquisitions since 2008, the Canadian drugmaker is regrouping after failing last month to acquire Botox-maker Allergan Inc (AGN.N), they said.
The new strategy, targeted for the next two to three quarters, may surprise some investors accustomed to Valeant's usual way of doing business. Speculation about Valeant's next takeover target has driven up shares in generic drugmaker Mylan Inc (MYL.O), medical device maker Cooper Companies (COO.N) and Teva Pharmaceutical Industries Ltd (TEVA.TA).
Valeant does not rule out pursuing deals where appropriate, but it is focused on its ability to pay down debt or buy back shares, said spokeswoman Laurie Little.
"The silver lining that has come out of the Allergan situation is that we have already reported one relatively clean quarter," said Little. "By delivering several more clean quarters over the next several months, we will clearly show the strength of our base business."
By clean quarter, Little was referring to the absence of one-time acquisition costs that frequently appear on Valeant's balance sheet.
After spending $19 billion on 40 acquisitions since 2008, the Canadian drugmaker is regrouping after failing last month to acquire Botox-maker Allergan Inc (AGN.N), they said.
The new strategy, targeted for the next two to three quarters, may surprise some investors accustomed to Valeant's usual way of doing business. Speculation about Valeant's next takeover target has driven up shares in generic drugmaker Mylan Inc (MYL.O), medical device maker Cooper Companies (COO.N) and Teva Pharmaceutical Industries Ltd (TEVA.TA).
Valeant does not rule out pursuing deals where appropriate, but it is focused on its ability to pay down debt or buy back shares, said spokeswoman Laurie Little.
"The silver lining that has come out of the Allergan situation is that we have already reported one relatively clean quarter," said Little. "By delivering several more clean quarters over the next several months, we will clearly show the strength of our base business."
By clean quarter, Little was referring to the absence of one-time acquisition costs that frequently appear on Valeant's balance sheet.
Valeant dropping deal making for near term
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