Pharmaceuticals giant Pfizer Inc will acquire Hospira Inc, a leading provider of injectable drugs, infusion technologies and biosimilars, at a total enterprise value of $17 billion.
This is Pfizer's biggest acquisition after its failed $117 billion takeover bid for UK-based pharmaceuticals firm AstraZeneca in May last year.
The Boards of Directors of Pfizer and Hospira have unanimously approved the merger, Pfizer said in a statement. Under the deal, Pfizer will pay $90 a share in cash for a total enterprise value of approximately $17 billion.
"The proposed acquisition of Hospira demonstrates our commitment to prudently deploy capital to create shareholder value and deliver incremental revenue and EPS (earnings per share) growth in the near-term," Pfizer Chairman and Chief Executive Officer Ian Read said.
Coupled with Pfizer's global reach, Hospira is expected to drive greater sustainability for Pfizer's Global Established Pharmaceutical business over the long term, he added.
Hospira CEO, F Michael Ball said: "The Pfizer-Hospira combination is an excellent strategic fit, presenting a unique opportunity to leverage the complementary strengths of our robust portfolios and rich pipelines."
Pfizer said it expected to finance the transaction through a combination of existing cash and new debt, with approximately two-thirds of the value financed from cash and one-third from debt.
"In addition, Pfizer anticipates the transaction to deliver $800 million in annual cost savings by 2018," the company added.
Subject to customary closing conditions, including regulatory approvals in several jurisdictions and approval of Hospira's shareholders, the deal is expected to close in the second half of 2015, it added.