April 24, 2015
By Mark Terry, BioSpace.com Breaking News Staff
Canonsburg, Pa.-based Mylan , announced today that it had filed under the Irish Takeover Rules that it had plans to acquire Ireland-based Perrigo .
If and when the deal closes, Mylan shareholders will own about 61.8 percent of outstanding ordinary shares and former Perrigo shareholders will own about 38.2 percent of the outstanding Mylan shares. Mylan projects that the combined companies will see at least $800 million of pre-tax operational synergies by the end of the year.
“We are taking this next critically important step,” said Robert Coury, executive chairman of Mylan in a statement, “which begins the clock under the rigid timeframe set by the Irish Takeover Rules, in order to continue to ensure clarity and certainty around our intentions for investors, particularly in light of the strong market reaction to this combination and demands from investors for us to take this step.”
As part of the deal, Mylan offered $60 in cash and 2.2 of its own shares for each Perrigo share. As of this morning, Mylan shares were trading at about $74. This deal would have run about $33 billion.
On April 21, 2015, Mylan had made another bid, which the Perrigo board unanimously rejected.
This is further complicated by the involvement of Israel-based Teva Pharmaceuticals. On April 21 Teva offered $82 per share for Mylan. That deal would have come in at around $40 billion.
Mylan has argued that culturally, Teva and Mylan do not fit well, and that there is too much overlap in their business.
Perrigo, however, is “an attractive asset in a rapidly consolidating space,” said Chris Schott, an analyst with JPMorgan Chase & Co. in a Wednesday note.
Mylan’s hostile takeover bid of Perrigo would possibly prevent the acquisition by Teva. Teva has indicated that its $40.1 billion bid was still on the table as long as Mylan ended its bid for Perrigo.
Mylan is primarily sells generic prescription drugs. It’s best-selling product is the EpiPen, for the emergency treatment of allergic reactions.
Perrigo manufactures and markets over-the-counter drugs for coughs and colds and infant formula, which are then sold by stores like Wal-Mart and Walgreens under their own brand names.
If the Mylan-Teva deal comes together, how will that affect Mylan’s 30,000 employees? “Whether it happens remains to be seen,” said Brian Lego, an economic forecaster with the Bureau of Business and Economic Research in a statement. “But if it does, it’s really not clear what would happen to facilities here in Morgantown and in the broader areas.”
Mylan was contacted for a statement, but was not available as of publication time.
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