Ackman To Allergan: Time Has Come To Talk Deal

May 7 2014 | 12:09pm ET

When Allergan Inc. adopted a poison pill after his Pershing Square Capital Management bought a nearly 10% stake in it, William Ackman said he’d give the company a chance to consider the $46 billion buyout offer from Valeant Pharmaceuticals International that he favors. It seems he thinks two weeks is enough.

Ackman on Monday urged Allergan to begin talks with Valeant, whose earlier approaches it firmly rejected, without delay.

“As Allergan’s largest shareholder, we are supportive of Allergan making the best possible deal with Valeant or identifying a superior transaction with another company,” Ackman wrote to Allergan.”Given the short list of potential acquirers and Valeant’s willingness to negotiate quickly, we believe Allergan can explore its strategic alternatives and determine a course of action within a matter of weeks.”

Indeed, time is not on Allergan’s side, Ackman warned.

“Unless Allergan were to identify such a transaction in the very near future, the odds of such a deal are likely to decrease over time, and the market and Valeant will likely learn of the lack of interest from alternative companies. Valeant management has publicly acknowledged it understands this dynamic and has even suggested it would consider reducing its offer if Allergan does not engage and no alternative suitor emerges.”

Ackman teamed with Valeant to buy the 9.7% Allergan stake, Pershing Square’s largest investment ever.


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