Mylan Board unanimously refuses takeover Bid from Teva due to lower valuation
A $40.1 billion takeover offer from Teva Pharmaceutical Industries Ltd has been unanimously rejected by Mylan NV’s board. The reasons given by Mylan for rejecting the offer were the amount being too low and showing nothing that how the difficulties of combining companies with different culture would be addressed.
The board is in no mood to go ahead with talks to sell the company unless Teva increases the bid to more than $100 a share, Mylan said in a statement Monday. Last week, Mylan received an offer from Teva for $82 a share in cash and stock.
“The Mylan board concluded the approach did not meet any of the key criteria that would cause the Mylan board to depart from the company’s successful and longstanding standalone strategy, and consider engaging in discussions to sell”, Mylan said.
Mylan also appears to have other plans as it is eyeing to for fellow drugmaker Perrigo Co. for $31.2 billion. Mylan said the transaction would be more complementary in terms of products and regional assets.
Headquarters of Mylan and Perrigo are located in the US, unlike Teva, which is based in Israel. Mylan and Perrigo have also moved their tax domiciles to Europe for tax purposes.
Mylan’s share declined 4.2% to $72.86 at 10:12 am in New York. A drop of 2.3% was also seen in Teva’s American depositary receipts to $62.92. Perrigo managed to seek a climb, but it was less than 1% to $193.70. Teva said in a statement that the company was looking forward to enter into talks with Mylan to finish the procedure to strike the deal.
Consumer advocates, pharmacists and other groups are of the belief that a merger of Teva and Mylan would allow companies to increase prices of same drugs currently offered by them.
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