PDL BioPharma Gives Up on Acquiring Neos Therapeutics
PDL has made three failed attempts to acquire the Texas-based Neos and decided that enough is enough. In a statement issued this morning PDL called it quits. Although its most recent offer to acquire Neos expired in November, PDL said it maintained interest until recently but has since made the decision to “not make any further proposals.”
In late October the Neos board of directors unanimously rejected PDL’s third offer. At the time of the rejection, the Neos board said each of PDL’s offers was essentially identical and thus were easy to reject. In November PDL said it did not intend to extend the deadline, which apparently it seemed to unofficially do. PDL did not provide any additional information as to why it finally stopped pursuing Neos, nor did it provide a hint of what that proverbial straw that broke the camel’s back might have been.
“While we believe we have provided a compelling opportunity for Neos' shareholders, we were unable to agree on terms that were in the best interest of our shareholders. We continue to pursue other opportunities and be disciplined in the process,” PDL Chief Executive Officer John P. McLaughlin said in a statement.
Shares of both companies are down slightly following the announcement. PDL dipped to $2.47 per share and Neos dropped about 1 percent to $9.25 per share.
Throughout 2017 PDL made three separate attempts to acquire Neos for about $287 million, or about $10.25 per share. The first two attempts to acquire Neos were made privately, but in October 2017 PDL publicly announced its intentions to acquire Neos, a company specializing in ADHD medicines for children. When PDL went public with its offer the company said it wanted Neos shareholders to know about the “good faith offer.” Additionally, as BioSpace reported in October, PDL said it also made the offer public “so that Neos shareholders can decide what is in their best interest.”
The $10.25 per share stock offer was a premium of approximately 40 percent to the pre-proposal closing price of Neos shares in October.
“We believe Neos shareholders should not be denied the opportunity to consider our all-cash proposal of $10.25 per share,” PDL said in an October letter to the Neos board of directors, which it made public at the time.
That wasn’t enough to convince Neos. In rejecting PDL in October company CEO Vipin K. Garg called PDL’s offer opportunistic. He said Neos is “well positioned to deliver enhanced value to Neos shareholders in both the near- and long-term.” He added that PDL’s repeated attempts to acquire the company underscored the assumption of Neos’ value.