The unsolicited bid, if successful, would bring together two mid-sized pharmaceutical companies with expertise in skin care and eye care products, in an unusual deal that is being backed by an activist investor.
Bill Ackman's Pershing Square, Allergan's largest shareholder with a 9.7 percent stake, disclosed in a filing on Monday that it is supporting the bid.
Valeant said it has offered to pay $48.30 per share in cash and 0.83 of its common share for each Allergan share, valuing Allergan at $152.88 a share, a premium of over 7 percent to the company's closing price on Monday.
Shares in Allergan jumped 19 percent in trading before the morning bell to $168.6 in New York, while those of Valeant rose 6.7 percent to $134.51.
Valeant, which has been on a buying spree and most recently acquired Bausch & Lomb Holdings, said that a merger with Allergan would create an unrivaled platform for growth.
Allergan, which also has a lucrative portfolio of ophthalmic drugs to treat conditions such as glaucoma and dry eye, is larger by revenue, reporting $6.3 billion in sales last year. Valeant reported $5.8 billion in revenue last year.
Allergan was not immediately reachable for comment on the unsolicited bid.