Perrigo lab worker
A worker is shown in a laboratory at Perrigo Co. PLC's operation on Eastern Avenue in Allegan.
(Courtesy Photo)
ALLEGAN, MI - Mylan NV still wants Perrigo Co. PLC.
Perrigo continues to say no.
Three days after Perrigo's board of directors rejected an April 6 unsolicited bid of $28.9 billion in cash and stock by Mylan, the generic drug maker announced on Friday that it is formalizing its offer.
In a deal valued at about $31.3 billion, Mylan is offering $222 per share based on the Thursday closing price of Mylan stock, according to Reuters news service.
According to terms of the offer, Perrigo shareholders would receive $60 in cash as well as 2.2 Mylan ordinary shares for each Perrigo ordinary share.
In a press release, Perrigo's Board of Directors rejected the offer, stating, "Today's announcement from Mylan proposes a price that is lower than the previously rejected proposal. Based on Mylan's unaffected price of $55.31 per share on March 10, 2015, the last day of trading prior to widespread public speculation that Teva was considering an offer for Mylan, the value of the offer is $181.67 per Perrigo share."
The board strongly advised its stockholders "to take no action in relation to the offer."
In a press release, Mylan Executive Chairman Robert J. Coury stated, "Mylan has today begun a legally-binding process under the Irish Takeover Rules to commence its offer for Perrigo, demonstrating our commitment to making this compelling combination a reality."
Perrigo is one of the world's largest makers of over-the-counter and generic prescription pharmaceuticals and nutritional products. They are sold under under the labels of many major retailers. It reincorporated itself in Dublin, Ireland, in late 2013 but its administrative headquarters and top management remain in Allegan, its original hometown.
Perrigo is a $4 billion company that has about 12,500 workers worldwide. The majority of its 4,000 Michigan workers are in Allegan County. And the company is Allegan County's largest employers.
Mylan is a generic drug giant that reincorporated itself in The Netherlands earlier this year but has its home base outside Pittsburgh. It has about 30,000 employees worldwide and did about $7.7 billion in sales last year.
"We are taking this next critically important step, which begins the clock under the rigid timeframe set by the Irish Takeover Rules, in order to continue to ensure clarity and certainty around our intentions for investors, particularly in light of the strong market reaction to this combination and demands from investors for us to take this step," Coury said.
With the merger, Mylan hopes to create the world's largest generic pharmaceuticals maker. But in a Wednesday statement, Perrigo Chairman, President and Chief Executive Officer Joseph C. Papa said Mylan's first offer substantially undervalued Perrigo and Perrigo sees greater value in remaining independent.
In Friday's announcement, Coury spoke of Perrigo's initial rejection, saying, "While we are disappointed by the decision of the Perrigo Board to reject our proposal without entering into discussions thus far, we are still hopeful and confident that we can engage with their Board about our offer and how to best bring our organizations together."
As different players in the pharmaceutical industry continue to try to grow through mergers and acquisitions, Mylan became the subject of an unsolicited buyout offer earlier this week. Israeli generics giant Teva Pharmaceuticals Industries Ltd. made an unsolicited offer on Tuesday of $40 billion for Mylan.
According to some news reports, Mylan's bid for Perrigo may be seen as an attempt to roil Teva's takeover interest.
Kalamazoo Gazette/MLive Business writer Al Jones may be contacted at ajones5@mlive.com. Follow me on Twitter at ajones5_al