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W-L buying Agouron
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January 26, 1999: 6:12 p.m. ET
Warner-Lambert to pay $2.1 billion for maker of AIDS, cancer drugs
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NEW YORK (CNNfn) - Warner-Lambert Co. said Tuesday it agreed to buy Agouron Pharmaceuticals Inc., maker of the leading AIDS drug Viracept, for $2.1 billion in stock.
The maker of Zantac antacid, Listerine and other products said Agouron also is developing drugs to fight cancer and other diseases. Agouron, based in La Jolla, Calif., had sales of $467 million in its fiscal year ended last June.
Warner-Lambert (WLA) earned $870 million on sales of $8.2 billion in 1997, the latest full-year data available.
Warner-Lambert said the deal fit with its strategy of boosting growth through alliances, partnerships and acquisitions and would not dilute its earnings.
"This merger is intended to strengthen our research and development," Anthony Wild, president of Warner-Lambert's pharmaceutical division, said in a statement.
Agouron, which specializes in developing drugs for cancer, viral diseases and eye maladies, has 700 of its 1,000 employees engaged in research and development, which is key to drug makers looking for the next blockbuster product.
Warner-Lambert officials said Agouron headquarters would remain in California and that no job cuts were planned.
Agouron's Viracept, which fights HIV, the virus that causes AIDS, won marketing clearance from federal regulators in 1997.
Under the deal, Warner-Lambert will swap about $60 worth of its stock for each share of Agouron, the companies said in a statement.
The deal is subject to approval by Agouron shareholders and regulators.
Warner-Lambert stock rose 1-5/8 to 69-1/8 on the New York Stock Exchange while Agouron jumped 3-21/32 to 56-13/16 on Nasdaq. The deal was announced after the close of NYSE trading Tuesday.
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Warner-Lambert
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