Valeant Pharmaceuticals International intends to acquire Solta Medical, a US-based developer of energy-based medical devices for aesthetic applications, for approximately $250m.
Valeant will pay $2.92 per Solta share, which is a 40% premium to Solta's closing share price on 13 December, the last trading day prior to the announcement.
Solta believes the acquisition by Valeant provides the best opportunity for its brands and employees to achieve their full potential while generating a significant, near term return for its stockholders.
Solta's board unanimously approved the acquisition, which is expected to close in the first quarter of 2014.
Once completed, Canada-based Valeant expects the deal to be immediately accretive to Valeant's cash earnings per share. Solta had total revenue of approximately $145m in 2012.
Under the terms of the deal, Valeant will begin a tender offer for all outstanding shares of Solta at a price of $2.92 per share in cash, subject to receipt of regulatory approval and other customary closing conditions.
Following the completion of the tender offer, a wholly owned subsidiary of Valeant will merge with Solta.
Solta Medical board chairman and interim CEO Mark Sieczkarek said the company's board of directors has determined that this all cash offer is in the best interest of its stockholders.
"The addition of Solta's industry leading brands and global sales organisation creates a very compelling platform for future growth in the medical aesthetic segment," Sieczkarek said.
Some of Solta's products include the Thermage CPT system that provides non-invasive treatment options using radiofrequency energy for skin tightening, the Fraxel repair system for use in dermatological procedures, and the Clear + Brilliant system to improve skin texture and help prevent the signs of ageing skin.
Valeant chairman and CEO J Michael Pearson said: "Solta's leading aesthetic devices are a natural fit with Valeant's facial injectables, professional skin care products and physician dispensed products and will establish Valeant in a strong leadership position as we continue to build our presence in the aesthetic market.
"Moreover, this transaction will further enhance our ability to offer dermatologists and plastic surgeons the most comprehensive aesthetic product offering."
Piper Jaffray & Co acted as financial advisor to Solta and Fenwick & West LLP acted as legal advisor to Solta. Skadden, Arps, Slate, Meagher & Flom LLP acted as legal advisor to Valeant.