The Hindu

Perrigo shareholde­rs snub drugmaker Mylan’s $26 billion hostile bid

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Perrigo Co Plc’s shareholde­rs rejected Mylan NV’s $26 billion hostile bid, ending the Netherland­s-based generic drug maker’s seven-month pursuit of its smaller rival.

Mylan’s offer expired on Friday with just 40 per cent of Perrigo shares tendered, below the required minimum 50 per cent, ensuring victory for Perrigo Chief Executive Joseph Papa.

Mixed reaction

Mylan shares rose as much as 14.4 per cent, while Perrigo shares fell as much as 10 per cent. Perrigo can re-enter the merger and acquisitio­ns (M&A) arena with much less uncertaint­y, increasing the odds of a mid-sized to large deal, Jefferies analyst David Steinberg wrote in a note.

Reuters reported on Thursday that the Dublin-based company had held talks with Endo Internatio­nal Plc, an-other Ireland-based drugmaker.

Healthcare deals worth a record $477 billion had been announced by the end of October, according to Thomson Reuters data, as companies consolidat­e to cut costs and gain scale.

Perrigo, with a large portfolio of consumer products, infant formulas and over-thecounter generic topical drugs, has long been seen as a takeover target.

To convince investors to rebuff Mylan’s offer, Perrigo had announced job cuts and a $2 billion share buyback plan last month.

Perrigo said on Friday it would immediatel­y start buying back shares, helping pull its stock off a more than oneyear low.

Mylan Executive Chairman Robert Coury, who snubbed an offer from Teva Pharmaceut­ical Industries to pursue Perrigo, said the company was ready to move on.

Mylan is well-positioned to “quickly execute on the next strategic, value-enhancing opportunit­ies,” some of which it has already identified, Coury said in a statement.

Raymond James analyst Elliot Wilbur, however, said he did not expect an immediate deal.

“Mylan won’t necessaril­y be immediatel­y opening up its checkbook for the next company it can buy and instead will step back, take a breather, and focus on the companies or assets it should buy,” he wrote in a note.

Mylan shares were up 13.4 per cent at $48.98 in afternoon trading, while Perrigo shares were down 7 per cent at $145.50.

 ?? FILE PHOTO: AP ?? This file photo shows an EpiPen epinephrin­e auto-injector, a Mylan product, in Hendersonv­ille, Texas. Mylan first made its interest in Perrigo public in April and went hostile in September, offering $75 plus 2.3 of its shares for each Perrigo share...
FILE PHOTO: AP This file photo shows an EpiPen epinephrin­e auto-injector, a Mylan product, in Hendersonv­ille, Texas. Mylan first made its interest in Perrigo public in April and went hostile in September, offering $75 plus 2.3 of its shares for each Perrigo share...

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