Valeant raises bid to $53B for Allergan

Valeant now willing to pay $53B for Allergan

Valeant Pharmaceuticals (NYSE:VRX, TSE:VRX) again increased its offer to Allergan (NYSE:AGN) shareholders, hoping to win them over with steep premiums as the company remains stalwart in refusing to open up to acquisition talks.

The new offer prompted an after-hours spike in AGN’s shares, which were up to $168.58 as of about 5:40 p.m., a 6.9% increase over this morning’s open at $157.66.

Valeant is now offering $72 per share, up from the $58.50 offer made earlier this week, which was in turn an increase over the initial $48.30 bid made last month. Analysts at BMO Capital Markets called the sweetened offer a "strange and unexpected twist" in the tumultuous history of the hostile takeover attempt.

"Just two days after Valeant CEO Mike Pearson said ‘I will assure you we are not going to keep offering against ourselves,’ he is doing just that," BMO analysts David Maris wrote today. "If Valeant management indicates the revised bid is in reaction to some Valeant shareholders wanting the proposed deal, we understand why Valeant shareholders covet Allergan’s balance sheet and growth."

Maris further added that the new Valeant offer "substantially undervalues Allergan."

"We believe other moves, such as a buyback or dividend, or a combination with or acquisition of a more like minded company is in the better interests of Allergan shareholders," Maris wrote.

Allergan issued a statement today acknowledging the offer, saying that it would "carefully review and consider" the formal proposal and "pursue the course of action that the Board believes is in the best interests of the Company and all of its stockholders."

The new deal represents a cash-and-stock value of $179.25 per share, including $72 in cash, 0.83 shares of Valeant stock and a $25 payout attached to certain revenue milestones for Allergan’s DARPin eye drug. The proposal is contingent on a "prompt good faith negotiation of a merger agreement between Valeant and Allergan."

"We strongly believe that applying Valeant’s operating philosophy, strategy, and financial discipline to a broader set of durable assets will continue to create substantial returns for shareholders over the short, intermediate, and long term," Valeant chairman & CEO J. Michael Pearson said in prepared remarks. "We are very committed to getting this deal done, and are now modifying our offer with the assistance of Pershing Square to increase the economics for all Allergan shareholders."

Allergan has been swatting back the acquisition pressure for weeks, saying that the company has had serious concerns with Valeant’s business model. The new bid comes just days after Allergan issued a presentation questioning Valeant’s organic growth, the performance of its acquisition of Bausch & Lomb and Medicis, its ability to provide scale and the stability of its leadership team, and other issues.

Shortly after Valeant and Pershing made the offer last month, Allergan swallowed a poison pill designed to insulate it from a takeover. Days later major Allergan shareholder Polen Capital Management said the company could do better. Last week Pershing defended the bid, with Ackman urging Allergan’s board to concede to a meeting to explore the offer.

RSS From Medical Design & Outsourcing

  • Athermal laser machining cuts bioabsorbable polymers and more
    A the recent MD&M East trade show in New York, Norman Noble, discussed the capability of athermal laser manufacturer. The company has developed the Noble S.T.E.A.L.T.H. (System To Enable Ablation Laser Technology Haz-free). The athermal laser machining process was developed to create precise features in any material, including bioabsorbable polymers, shape memory metals and other […]
  • Exciting possibilities for metallic glass in the medical device world
    Researchers are exploring the potential of metallic glass as a versatile, pliable material that is stronger than steel, with a bevy of possible medical device applications. Yale University engineers have discovered a unique method for designing metallic glass nanostructures across a wide range of chemicals, a technique that could have applications for everything from watch […]
  • Strong Precision Technologies’ medical divisions to unify under MedTorque brand
    Strong Precision Technologies announced on July 2, 2015, that its two medical divisions will now go to market under a single brand, MedTorque. The move reflects the increasing integration of the division formerly known as Inland Midwest with MedTorque, its sister division in Kenosha, WI. “We will continue providing our customers with the personalized level of service […]
  • Olympus offers next-day product replacement guarantee for medical devices
    Olympus, a medical and surgical procedures solutions company, announced that it is guaranteeing next-day replacements for surgical equipment at no additional charge. Olympus is the first surgical product manufacturer to offer this type of guarantee. The service became available to customers with an Olympus Full Service Agreement earlier this year. “Canceled procedures can be costly for healthcare facilities […]
  • More accurate prediction on prognosis in multiple myeloma from SkylineDx
    SkylineDx, a biotechnology company specializing in the development and commercialization of genetic tests, is launching its MMprofiler assay. This test enables clinicians to more accurately predict the prognosis of patients with multiple myeloma (bone marrow cancer) than traditional methods. The MMprofiler measures the activity of 92 genes which are directly or indirectly related to the […]
  • Flint Mobile swaps card reader for camera, accept mobile payments anywhere
    Flint Mobile, the swipe-free mobile payments app, has significantly expanded its payment management and loyalty capabilities for small, service-centric businesses, like the ones run by on-the-go medical equipment professionals. The toggle-free mobile technology makes the process quite simple for both parties, as all transactions are conducted through the mobile device’s camera without the need of any external […]
  • Should scientists be allowed to genetically alter human embryos?
    Scientists have at their disposal, a way to explore the possible prevention of genetic diseases before birth. But should they? Currently, the most promising path forward involves editing the genes of human embryos, a procedure threaded with controversy. An article in “Chemical & Engineering News” (C&EN), the weekly newsmagazine of the American Chemical Society (ACS), parses […]
  • Tackling chronic sinusitis by addressing underlying factors
    The stuffy noses and sinus pressure of head colds are uncomfortable, but for most people, they go away within days. For those with chronic sinusitis, however, those symptoms and others drag on for weeks. Now scientists are onto a potential new therapy that could address one of the underlying factors associated with the condition. They […]
  • Implantable “artificial pancreas” could help diabetes patients control their blood sugar
    Living with Type 1 diabetes requires constant monitoring of blood sugar levels and injecting insulin daily. Now scientists are reporting in the American Chemical Society (ACS) journal, “Industrial & Engineering Chemistry Research,” the development of an implantable “artificial pancreas” that continuously measures a person’s blood sugar or glucose level and can automatically release insulin as […]
  • Drug Deactivation program roll out to all facilities for safe disposal of unused prescription medications
    Verde Technologies announced that New Brighton-based Meridian Behavioral Health, the largest for-profit substance abuse and addiction treatment group in Minnesota, has become its most recent partner in the deactivation and safe disposal of prescription medications including methadone. Meridian is the first behavioral health group to roll out the Deterra Drug Deactivation System to all 17 […]
  • Lophius Biosciences introduces T-activated ImmunoScan Cocktail
    Lophius Biosciences announced the commercial launch of T-Track ImmunoScan and T-activated ImmunoScan Cocktail. Based on a proprietary and very specific cocktail of stimulants in combination with the Company’s T-activation technology, T-Track ImmunoScan and T-activated ImmunoScan Cocktail specifically target different cell types involved in both the adaptive and innate immune system. T-Track ImmunoScan and the T-activated […]

Leave a Reply