John Paulson's hedge fund has increased its holdings in Mylan NV to 4.5%. The fund, which supports Teva Pharmaceutical Industries Ltd.'s (NYSE: TEVA; TASE: TEVA) takeover bid for Mylan, bought seven million Mylan shares on April 30, giving it a total of 22 million shares.
Mylan is now Paulson's second largest holding, with a value of $1.6 billion.
The purchase will give Paulson greater influence on the Mylan shareholders and board of directors, after company management rejected Teva's offer to purchase, preferring meanwhile to continue its attempts at promoting a merger with Perrigo Company (NYSE:PRGO; TASE:PRGO).
Two weeks ago, major shareholders in Mylan called on the company to accept Teva's $41 billion offer to purchase. According to reports published by Reuters, shareholders, including Paulson's New York fund, which then held 14.9 million Mylan shares, amounting to 3% of Mylan's share capital, told the Mylan board of directors to accept Teva's offer. Paulson and Mylan declined to respond to the report.
Perrigo CEO Heather Bresch said that she was confident that Mylan's shareholders would back its management in the Perrigo deal. In a conference call with analysts, she added, "The combination of Mylan and Perrigo is clearly a logical one."
Disappointing results
Mylan yesterday published disappointing results, but its management said it was committed to the acquisition of Perrigo, despite Teva's offer to Mylan shareholders. Mylan reported a net profit of $0.70 per share for the first quarter of the year, compared with analysts' expectations of $0.71 per share. Revenue grew 9.1% to $1.87 billion, below analysts' expectations of $2.07 billion.
Currency differences reduced Mylan's revenue by $93 million, but the company reiterated its forecasts for 2015 and the target it set for 2018: a $6 net profit per share.
Published by Globes [online], Israel business news - www.globes-online.com - on May 6, 2015
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