Actavis PLC says it will acquire fellow drugmaker Forest Laboratories Inc. in a cash-and-stock deal worth about $25 billion.
The deal would create a combined company spanning both generic and branded drugs, including Forest's Alzheimer's treatment Namenda and the antidepressant Lexapro.
Actavis will pay Forest shareholders $26.04 in cash and a portion of an Actavis share for each Forest share. The total, per-share price of $89.48 represents a premium of about 25 percent over Friday's closing price.
Dublin-based Actavis has grown rapidly through acquisition, including an $8.5 billion deal last year to buy another Irish drugmaker, Warner Chilcott.
New York-based Forest Labs has been squeezed by generic competition to some of its biggest drugs, including Lexapro. It has been working to cut costs under new CEO Brenton L. Saunders.