Elan rejects fresh Royalty bid, assessing other interest
DUBLIN (Reuters) - Irish drug firm Elan Corp Plc ELN.I as expected rejected an increased offer from Royalty Pharma and on Monday said it was assessing enquiries from other interested parties.
U.S. investment firm Royalty raised its hostile bid to a potential $8 billion on Friday, the third increase in five months, after Elan shareholders held off tendering their shares in hopes of a bigger payday.
Rebuffing Royalty's advances again, Elan said the gap between what it believes to be the underlying value of the company and the new bid remained significant.
However, Elan said in addition it had instructed its advisors Citigroup (C.N: Quote) to assess other interest after it had received several recent unsolicited corporate enquiries.
"Both the board and executive management are aligned in exploring all opportunities that maximize the full value of the company for its shareholders," Elan said in a statement.
"There can be no assurances that this process will lead to the consummation of a sale transaction."
A spokesman for Elan said the company could not comment any further on who the other interested parties are.
Elan shareholders meet next Monday to vote on a series of defensive transactions that the Dublin-based company has recently made. Royalty's bid is contingent on each transaction being voted down.
Royalty is now offering $13 cash per share, up from $12.50 previously, with an added a contingent value right (CVR) clause that could mean an additional $2.50 per share if Elan's blockbuster multiple sclerosis drug Tysabri hits certain sales milestones.
Elan won a U.S. District Court order last week stopping Royalty from closing its tender offer. The court will meet again on Tuesday to decide whether to grant a preliminary injunction against Royalty.
(Reporting by Padraic Halpin; Editing by David Holmes)
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