Valeant Responds to Allergan’s Merger Rejection

Valeant’s top executive told Allergan shareholders that it plans to increase its financial offer to merge the two companies after the rival drugmaker rejected the initial $47 billion bid.

Valeant had proposed $48.30 in cash and 0.83 shares of Valeant common stock for each share of Allergan.

In a letter to Allergan shareholders, Valeant chairman and CEO J. Michael Pearson said that his company’s offer was “rejected without Allergan having had any discussions with Valeant.” He also noted that “Allergan offered a business as usual strategy while attempting to discredit our company.”

Valeant has scheduled a webcast for May 28 at 8 a.m. Eastern to discuss why it believes its offer is superior to Allergan’s “go at it alone” strategy. The webcast also will discuss Valeant’s operating model, and explain why the proposal offers significant shareholder value, the letter says.

Furthermore, to demonstrate its commitment to the deal, Valeant also plans to increase its offer for Allergan, said Pearson, who didn’t offer specifics. Valeant is prepared to pay a “full and fair price, but consistent with our track record, we will remain financially disciplined,” Pearson said.

He added that his company will not stop its pursuit of a merger until it hears directly from Allergan shareholders that they prefer to “stay the course.” — Kellen Owings

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