Mylan Rejects Teva Pharmaceutical’s Takeover Bid

PITTSBURGH (Pittsburgh Post-Gazette/TNS) -

Mylan on Monday rejected Teva Pharmaceutical Industries’ unsolicited takeover proposal, saying it “grossly undervalues” Mylan, would give Mylan shareholders “low-quality, high-risk” Teva stock, and expose Mylan shareholders “to a problematic culture and leadership.”

“We do not wish to make Teva’s problems Mylan’s problems, or to inflict them on Mylan’s shareholders and other stakeholders,” Mylan Chairman Robert Coury wrote in a letter to Teva CEO Erez Vigodman.

The letter, released by Mylan, is the latest twist in a three-way merger brawl that involves Netherlands-based Mylan, Israel-based Teva, and Perrigo, an Irish drug maker.

Teva last week offered to acquire Mylan for $82 per share, or about $43 billion, with half of the consideration in cash and the other half in Teva stock.

Following Mylan’s rejection, Teva issued a statement Monday underscoring its commitment to completing the roughly $43 billion deal.

“While we are disappointed that Mylan has formally rejected our proposal, the Teva board and management team are fully committed to completing the combination of Teva and Mylan,” the statement said.

“Teva stands ready and willing to meet with Mylan and its advisors immediately.”

Teva reiterated that its proposal offered a substantial premium to Mylan stockholders and “the opportunity to participate in the significant upside potential of a financially and commercially stronger company.”

It added that regulatory clearances for the proposed transaction were under way.

Mylan, which has its executive and operational headquarters in suburban Pittsburgh, on Friday offered to acquire Perrigo, in a cash-and-stock deal that values Perrigo at $227.33 per share, or about $31 billion, based on Mylan’s closing stock price Friday.

Perrigo quickly rejected Mylan’s overture. Perrigo had rejected an earlier offer from Mylan valued at about $29 billion.

Analysts believe Mylan is going after Perrigo in order to discourage Teva from going after it.