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$32B deal: Mylan boosts offer for drugmaker Perrigo

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$32B deal: Mylan boosts offer for drugmaker Perrigo

Drugmaker Perrigo said Friday it has rejected Mylan’s new takeover offer in the latest twist in a three-way merger battle. Perrigo said that by its reckoning, the proposal is actually lower than Mylan’s previous bid. Earlier in the day, British Mylan offered to buy Perrigo of Ireland for $60 in cash and 2.2 shares for each Perrigo share. Based on Mylan’s closing price Thursday, that’s a total bid of $222 per share — or about $32 billion — and a 10% premium over Perrigo’s closing price that day.635654699931878863-66466JR007-11-Million-Bo

It’s also higher than Mylan’s offer of $205 in cash and stock that Perrigo rejected earlier this week as too low. But Perrigo said that based on Mylan’s “unaffected” stock price on March 10, the last day before speculation that Teva was considering an offer for Mylan, the value of Mylan’s proposal is $181.67 per share. “Today’s announcement from Mylan proposes a price that is lower than the previously rejected proposal,” Perrigo said in a statement.

While Mylan mostly makes generic drugs, Perrigo gets a large chunk of its revenue from over-the-counter cold medicines. Early this week, generic drug giant Teva offered to buy Mylan for $40.1 billion if Mylan doesn’t buy Perrigo, saying its proposal would be a better deal for Mylan shareholders. But Mylan said that link-up would be unlikely to win antitrust approval in light of the significant overlap in the companies’ businesses.

Pharmaceutical companies are scrambling to merge with one another to increase revenue and cut costs as growth slows. Mylan said the combination with Perrigo would yield at least $800 million in annual pretax synergies.

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