In a stock-for-stock transaction, one company, the buyer, exchanges its stock for another company, the purchased, at a predetermined rate. This functions as a buyout, using stock rather than cash as the medium.
While this valuation seems high, it is in fact an excellent deal for Ireland-based Actavis. Because of a lower overall EU tax on acquisitions, coupled with the more favorable business taxes in Ireland that make it a haven for many leading companies (Facebook, Google, etc.), Actavis saved money on purchasing in general in its purchase of Warner Chilcott.