Valeant Pharmaceuticals International’s $53 billion offer for Allergan Inc. is still not rich enough for the latter.
Valeant, which is working with Pershing Square Capital Management on the bid, increased the offer twice late last month. But Allergan, which has said it prefers to remain independent, isn’t budging.
“We do not believe your latest proposal offers sufficient or certain value to warrant discussions between Allergan and Valeant,” Allergan CEO David Pyott wrote to his counterpart at Valeant, Michael Pearson.
That is not likely to sit well with Pershing Square’s William Ackman, Allergan’s largest shareholder, who has championed a deal and insisted that Allergan hold talks with Valeant. This week, Ackman said he had the support of a number of large Allergan investors for a deal at $180 per share, roughly the value of Valeant’s latest bid.
Ackman is also preparing a proxy fight to oust a majority of Allergan’s board later this year. The Botox-maker said the board’s vote against Valeant’s most recent offer was unanimous.
Allergan has blasted Valeant as a serial acquirer whose strategy is unsustainable. Pyott wrote that the latest proposal both “substantially undervalues” his company and “creates significant risks and uncertainties.”