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Mylan Raises Its Offer for Perrigo, Which Rejects It

The drug maker Mylan on Friday raised its unsolicited offer for Perrigo, the Irish maker of store brand drugs, as it seeks to fend off its own unwanted suitor in Teva, the Israeli pharmaceutical company. But Perrigo quickly rejected the revised bid.

Mylan’s new bid for Perrigo is worth about $33 billion. Perrigo rejected the previous offer of $29 billion on Tuesday, the same day that Teva offered to acquire Mylan for $40 billion.

Under Mylan’s new offer, Perrigo shareholders would receive $60 in cash and 2.2 shares of Mylan stock for each of their shares. Mylan also commenced a formal tender offer, as required under Irish takeover law, and said that the offer was fully financed and not contingent on due diligence.

Perrigo wasted little time in rejecting the revised bid, saying that the price was lower than the earlier offer because of the lift that Mylan’s shares have received from the Teva pursuit.

“The board previously concluded that Mylan’s unsolicited proposal of $205.00 per share significantly undervalued the company and its future growth prospects and was not in the best interests of Perrigo’s shareholders,” Perrigo said in a statement. “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.

Before the rejection, Mylan’s executive chairman, Robert J. Coury, said in a statement: “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.”

Mylan added that it expected to squeeze $800 million in annual savings out of a combination with Perrigo.

Teva responded immediately, saying that its offer for Mylan was the better alternative.

“The Teva board and management team remain fully committed to completing its value-creating combination of Teva and Mylan,” a Teva representative said in a statement. “Teva’s proposal to acquire Mylan for $82.00 per Mylan share provides Mylan stockholders with a significant premium and immediate value for their stock as well as the opportunity to participate in the significant upside potential of a financially and commercially stronger combined company. Our proposal for Mylan implies a total equity value of approximately $43 billion and an enterprise value of approximately $50 billion.”

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