(Adds Valeant comment, analyst comment)
May 27 Allergan Inc on Tuesday built its
case with investors for rejecting a $47 billion takeover offer
from Valeant Pharmaceuticals International,, saying the
Canadian drugmaker has overstated the possible savings from the
The move comes one day before Valeant will hold a webcast in
which it has said it will raise its offer for Allergan.
In slides posted to its website, the botox maker laid out
its argument for rejecting Valeant's offer and said that the
research and development and tax structure savings would not
materialize. Valeant and activist investor Bill Ackman made an
offer to buy Allergan on April 22, which Allergan spurned.
(Allergan presentation: r.reuters.com/tek69v)
Alvarez & Marsal and FTI Consulting, two third-party
consultants, reviewed Allergan's analysis and confirmed key
components, Allergan said.
The offer was $153 per share at the time of the bid.
Investors are looking for a price of $180 to $200 per share,
according to an investor survey last week.
Allergan said Valeant's low organic sales growth was driven
by price increases, that its acquired companies experienced
market share erosion and that Valeant lacked transparency in its
"Valeant's business leaders will provide further clarity on
our historic, current and future operating performance and
address Allergan's inaccurate assertions about our business
model at our event tomorrow," Valeant spokeswoman Laurie Little
said when asked to comment on Allergan's presentation.
Wells Fargo analyst Lawrence Biegelsen said in a research
note that if Allergan rejects Valeant's new bid, it expects
Allergan to then announce new steps to increase its financial
performance. That could include a strategic acquisition, a large
share buyback program or cost cutting.
Allergan shares were off 1.6 percent at $164.33 while
Valeant fell 3 percent to $129.54, both on the New York Stock
(Reporting by Caroline Humer in New York; Additional reporting
by Rod Nickel in Winnipeg; Editing by Bernadette Baum and Lisa