Pershing Square Activist Presentation Deck
Proper Way to Value the Proposed Transaction
Valued on an unaffected basis, this transaction is a merger
between a $42 billion equity market cap company, Valeant, and a
$35 billion company, Allergan¹
Allergan shareholders will own 44% of the combined company
► In such a stock transaction, one cannot value the offer using the
current market value of the acquirer's common stock
■ Investors must use the projected value of the combined entity,
considering any cost and revenue synergies, strategic benefits of
the transaction, and likely changes to the multiple investors assign
to the earnings of the combined company in their valuation
► Compare this transaction to one where target company
shareholders will own a minimal amount of the combined
company
■ In that case, this logic does not apply, and investors could use the
current market value of the acquirer's stock to value the offer
(1) Reffects Allergan's market capitalization as of April 10, 2014, the day before Pershing Square began its rapid accumulation program, and Valeant's market capitalization as of
April 21, 2014, the day before Valeant announced its bid to acquire Allergan.View entire presentation