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Feb 13, 2017

Allergan to buy Zeltiq for about US$2.48B

The Allergan logo is seen in this photo illustration in 2015

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Botox maker Allergan Plc (AGN.N) said it would buy body-contouring product maker Zeltiq Aesthetics Inc (ZLTQ.O) for about US$2.48 billion, adding muscle to its line-up of products used to fight fat and smoothen wrinkles.

Zeltiq's CoolSculpting System is approved by the U.S. Food and Drug Administration and utilizes a cooling mechanism to reduce the appearance of stubborn fat - which may not respond to diet or exercise - without disturbing surrounding tissue.

The Botox maker agreed to pay US$56.50 per Zeltiq share, or a premium of 14.4 per cent to the company's Friday close.

Zeltiq's shares jumped 12.6 per cent to US$55.65 in premarket trading on Monday.

Dublin-based Allergan, led by its acquisitive Chief Executive Brent Saunders, has orchestrated a flurry of deals since its US$160 billion merger with Pfizer Inc (PFE.N) collapsed in April.

Earlier this month, Saunders painted lofty expectations for its injection Kybella - used to diminish fat under the chin, leaving surrounding tissue largely unaffected - for 2017, and expressed an interest in continued deal making.

In the three months ended Dec. 31, total medical aesthetic product sales accounted for 28 per cent of Allergan's net revenue.

Allergan, which estimates that body contouring is a US$4 billion market, said the transaction is expected to close in the second half of 2017.

Moelis & Co is Allergan's financial adviser, while Debevoise & Plimpton LLP serve as legal counsel. Guggenheim Securities is Zeltiq's financial adviser, while Cooley LLP will provide legal advice.