Allergan announced in a press release today that its board of directors unanimously rejected the revised unsolicited proposal by Pershing Square and Valeant Pharmaceuticals, citing potential risks and uncertainties.
On May 30, Valeant Pharmaceuticals revised its proposal to acquire Allergan, offering to exchange each Allergan share for $72 and maintain 0.83 shares of Valeant common stock, according to a company press release. The offer was an increase per share of about 21%, up from $58.30 made one week prior and was contingent on prompt good faith negotiations.
“Valeant’s revised proposal substantially undervalues Allergan, creates significant risks and uncertainties for Allergan’s stockholders, and does not reflect the Company’s financial strength, future revenue and earnings growth or industry-leading R&D,” David E.I. Pyott, Allergan’s Chairman of the Board and CEO, said in the press release. “Allergan has a track record of generating consistently robust results and value for its stockholders, and we continue to have strong momentum in our business. The investment community has recognized the revised long-term growth outlook Allergan provided on May 12, 2014, and appropriately raised valuations for a standalone Allergan. We do not believe Valeant’s proposal reflects Allergan’s growth prospects, nor does it offer sufficient or certain value to warrant discussions between Allergan and Valeant.”
Allergan has filed an updated investor presentation with the Securities and Exchange Commission, which is posted under the “Investors” section of its website, according to the release. Additional detail regarding the Allergan board’s considerations behind the rejection is available, as well.