Abbott Laboratories to back Mylan-Perrigo deal
17 Jun 2015
Generic drugmaker Mylan NV's largest stakeholder, Abbott Laboratories, has said that it would back Mylan's proposed acquisition of British rival Perrigo Co Plc, a move that would help Mylan ward off an unsolicited bid from Teva Pharmaceutical Industries Ltd.
Abbott, which has a 14.5-per cent stake in Mylan, confirmed its continued support for Mylan N.V's growth strategy by intending to vote in favour of Mylan's proposed acquisition of Perrigo.
"We chose Mylan to acquire our developed markets branded generics pharmaceuticals because its scale and breadth across critical distribution channels, broad and diverse portfolio, and commitment to patients and product quality strongly positions it for success in the years to come," said Miles White, chairman and CEO, Abbott.
"As both Mylan's largest shareholder and its partner through our continued manufacturing relationships, Abbott has considered the entire situation and we believe Mylan's standalone strategy and acquisition of Perrigo will further enhance its platform, is strategically compelling, value enhancing for shareholders, and offers a clear path to completion. In light of these factors, we will be voting in favor of the Perrigo transaction," he added.
In late April, Irish generic drugmaker Perrigo rejected Mylan NV's revised takeover offer saying that the $34.10 billion unsolicited bid still undervalued the company.
The rejection from Perrigo comes even as Mylan itself is fending off an unsolicited $40 billion takeover bid from Israeli generic drug giant Teva.
The three-way hostile takeover battle highlights the desperate attempt by generic drug makers to consolidate in a market that is expected to rise to $358 billion next year.
Perrigo has said that Mylan's offer is too low since its share value has risen due to month-long media speculation of Teva's plan to table a bid for Mylan and its stock price would fall if Teva's attempt were to fail, which would lead to a decline in Mylan's stock offer of $167 of its own share for Perrigo.