Barclays on Medicis (MRX)/Valeant (VRX) Deal: Surprise...or Not Really?

Barclays maintains an 'Equalweight' on Medicis (NYSE: MRX) price target of $35.00.

Analyst, Douglas D. Tsao, said, "The timing comes as a surprise, but Valeant's (NYSE: VRX) interest does not. The Wall Street Journal reported in August 2011 that Valeant approached Medicis about an acquisition, although with the passage of time, it appeared that Medicis was uninterested in a transaction...However, with some recent initiatives around the Solodyn franchise experiencing some setbacks, forcing Medicis management to lower guidance with 2Q results, it appears that MRX management concluded it needed a larger partner. In our view, Valeant's strategic rationale for the deal is as much focused on MRX's product portfolio as VRX is interested in acquiring MRX's sales organization and its very strong relationships with dermatologists which VRX hopes can increase sales for its legacy product portfolio."

For an analyst ratings summary and ratings history on Medicis click here. For more ratings news on Medicis click here.

Shares of Medicis closed at $31.56 yesterday.

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