Mylan Pharmaceuticals' attempt at a hostile takeover of Perrigo Company (NYSE:PRGO; TASE:PRGO) has led to the filing of lawsuits by each company against the other. Perrigo filed a lawsuit against Mylan last week in the US District Court for the Southern District of New York, and two days ago, Mylan filed a countersuit in the Manhattan Federal Court.
Mylan is seeking to take over Perrigo in a deal at around its current market cap of $26.3 billion, and last week submitted an official offer to purchase for Perrigo's shareholders. The Perrigo board of directors strongly opposes the deal, and has recommended that the company's shareholders turn it down. Perrigo's lawsuit alleges that Mylan's published offer to purchase contains false and misleading reports. Perrigo is seeking to prevent Mylan from completing its offer to purchase before the reports are corrected in order to make sure that the Perrigo shareholders do not have to make their decision on the basis of information Perrigo refers to as materially misleading and untrue.
Among other things, Perrigo asserts that Mylan's argument that it will be able to achieve synergy amounting to $800 million following the acquisition of Perrigo is incorrect if Mylan obtains only control of Perrigo, rather than full ownership.
For its part, Mylan alleges in its claim that Perrigo has issued misleading and untrue reports, and should correct them. Mylan says that these reports were part of Perrigo's attempt to prevent a merger of the companies. Mylan notes that Perrigo CEO Joseph Papa publicly opposed its offer without declaring that he owned Mylan shares worth $220,000.
Marketing approval for anti-acne gel
Mylan's offer to purchase states a price of $75 in cash and 2.3 Mylan shares for each Perrigo share. At the current market price, this offer reflects a $179 price for the Perrigo share, lower than the original price of $205 mentioned by Myland several months ago, but 5% above the current Perrigo share price on the Tel Aviv Stock Exchange (TASE) and the New York Stock Exchange.
Perrigo is a generic drug company specializing in over-the-counter medicines drugs sold without a prescription. The company reported two days ago that it had obtained approval from the US Food and Drug Administration (FDA) for launching a generic version of the BenzaClin gel for treatment of inflammatory acne. Sales of the original and general product total $231 million a year.
Published by Globes [online], Israel business news - www.globes-online.com - on September 24, 2015
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