Sector News

Valeant ready to raise Allergan bid

October 27, 2014
Life sciences
(Reuters) – Valeant Pharmaceuticals International Inc (VRX.TO) (VRX.N) on Monday said in a letter to Allergan Inc’s (AGN.N) board of directors that it was prepared to raise its offer to at least $200 per share but stopped short of doing so.
 
Valeant, whose existing offer values the Botox maker at about $179 per share, or $53.25 billion, said last week that the Canadian pharmaceutical company was considering raising the bid and would increase the cash portion of the offer to do so.
 
“To be clear, Valeant is prepared to improve its offer and provide value to your shareholders of at least $200 a share. We are confident that an increase in our stock price, and in consideration, will provide that value,” Valeant Chief Executive Officer Michael Pearson said in the letter.
 
At $200 per share, the offer would be worth more than $59 billion.
 
Allergan said the letter was a tactic to distract investors from Allergan third-quarter earnings, which it announced on Monday morning and did not include offer details.
 
“I think all we saw today was an offer to negotiate,” Allergan Chief Executive Officer David Pyott said during a conference call.
 
Valeant and hedge fund Pershing Square Capital Management launched a hostile offer for Allergan in April, but the Botox maker has staunchly refused it. The company has said that shareholders will be better off if it stays independent or finds its own acquisitions.
 
Pyott declined to answer questions during the call about whether or not the company is pursuing a “white knight” acquirer for Allergan or its own purchases.
 
Allergan will hold a shareholder meeting on Dec. 18 at the request of investors who own more than 35 percent of the company’s stock, including Pershing Square head William Ackman. Investors will vote on new directors put forth by Ackman and to open discussions on the deal.
 
A hearing is scheduled on Tuesday in federal court in California where a judge will hear from both sides on if Ackman’s stake in Allergan of nearly 10 percent should count as part of that shareholder vote. Allergan asked to exclude the shares as part of an insider trading suit it filed against Valeant and Pershing Square.
 
Separately on Monday, Allergan reported a third-quarter profit of $1.78 per share, excluding items. On Oct. 9, the company preannounced those earnings and said it would report a profit that was more than 20 percent higher than it had previously expected, in the range of $1.76 to $1.78 per share.
 
Allergan also raised the outlook for the current quarter, saying it now expects earnings of $1.80 to $1.83 per share, and for the year of $6.27 to $6.30 per share.
 
Allergan’s shares were off 0.1 percent or 20 cents at $184.01 on Monday. Valeant shares were up 0.2 percent or 30 cents at $129.43 on the New York Stock Exchange.
 
(Reporting by Caroline Humer in New York and Sayantani Ghosh and Ashutosh Pandey in Bangalore; Editing by Sriraj Kalluvila, Alden Bentley and Meredith Mazzilli)

comments closed

Related News

January 22, 2023

Sun Pharma to buy Concert Pharmaceuticals for $576m

Life sciences

Sun Pharmaceutical Industries has signed a definitive agreement to buy all outstanding shares of Concert Pharmaceuticals in a deal valued at $576m. Under the deal, the company will buy all shares of Concert common stock through a tender offer for $8.00 per share in cash upfront payment.

January 22, 2023

Novo Nordisk diabetes pill wins FDA approval for first-line use

Life sciences

The Food and Drug Administration on Thursday approved Novo Nordisk’s diabetes pill Rybelsus as an initial treatment to lower blood sugar levels, a label expansion that will allow it to compete more directly with other oral drugs from Merck & Co. and Eli Lilly.

January 22, 2023

Bayer feeling more heat from activist investors, this time from Bluebell

Life sciences

Since making an ill-advised $63 billion buy of Monsanto in 2018, Bayer has faced heaps of pressure from investors that have called for the company to oust its leadership and to restructure. Now comes new pressure from a familiar source. Bluebell Capital Partners has bought an undisclosed stake in the company and is agitating for a breakup, sources told Reuters.

How can we help you?

We're easy to reach