Pershing Square Pushes Poll For Allergan Shareholders

May 14 2014 | 12:16pm ET

Pershing Square Capital Management is looking to its fellow Allergan Inc. shareholders to pressure the Botox-maker to negotiate with Valeant Pharmaceuticals International, whose $46 billion takeover offer it rejected on Monday.

The New York-based hedge fund yesterday disclosed that it demanded a list of registered shareholders from Allergan, with plans to hold a referendum on whether the company should speak with potential buyers. Pershing Square chief William Ackman told The Wall Street Journal that the non-binding poll would give “shareholders an opportunity to express their point of view. What could be more democratic than that?”

The unusual maneuver, taken instead of seeking to force a special meeting, helps Pershing Square sidestep Allergan’s poison pill, which not only blocks the hedge fund from increasing its 9.7% stake, but also limits its communications with shareholders. Proxy campaigns are excluded from the restrictions.

The referendum also keeps Pershing Square in control of the process; if a special meeting were called, Allergan would have up to four months to schedule it.

Allergan, which called Valeant’s Pershing Square-backed offer too low, and which said it prefers to remain independent, said that the referendum was a “self-serving enterprise” that allows Valeant and the hedge fund to dictate “their own process.”

Valeant also made clear that it wasn’t giving up, saying it would improve its cash-and-stock offer on May 28. It is unclear whether the company will make a higher offer or increase the amount of cash in the deal, in an effort to entice Allergan to the negotiating table.


In Depth

An Interview With Harvest Volatility Management's Rick Selvala

Mar 23 2017 | 5:39pm ET

Several years of extremely low interest rates have pushed some investors into equities...

Lifestyle

'Tis the Season: Wall Street Holiday Parties Back In Fashion

Dec 22 2016 | 9:23pm ET

Spending on Wall Street holiday parties has largely returned to pre-2008 levels...

Guest Contributor

SEI: Private Debt Coming Into Its Own

Mar 8 2017 | 9:24pm ET

The explosive growth of private debt over the past few years has caused the lines...

 

From the current issue of