Allergan Bets on Aesthetics With $2.48 Billion Zeltiq Deal

Allergan Bets on Aesthetics With $2.48 Billion Zeltiq Deal Botox maker Allergan Plc is betting on aesthetics with the $2.48 billion acquisition of fat-chilling device maker Zeltiq Aesthetics Inc., doubling down on a lucrative industry where patients pay mostly in cash for products and services. The purchase price is $56.50 a share in cash, the companies said Monday in a statement, a 14 percent

premium to Pleasanton, California-based Zeltiq’s closing price Friday of $49.40. Through Friday, the stock had already more than doubled in the last 12 months.

With the deal, Allergan has now agreed to spend more than $5 billion in less than two months to build up its aesthetic-medicine and cosmetic-surgery lines -- businesses that are less susceptible to pressures from U.S. insurers and politicians seeking to reduce health costs. Zeltiq sells the CoolSculpting System, a noninvasive procedure that chills fat cells to the point where they die and are eventually eliminated. The procedure, first approved by the U.S. Food and Drug Administration in 2010, costs typically $2,000 to $4,000 per patient, according to Zeltiq’s website. It will join Allergan’s facial products, including its best-selling wrinkle treatment Botox, and regenerative lines.

The deal is a logical step as Allergan expands in aesthetics. “Allergan is kind of the leader” with plastic surgeons, said Kevin Kedra, an analyst at Gabelli & Co, who rates the shares as buy. “They have a larger presence, and a long history of being in these offices.”