Royalty pursuing hostile bid for Elan, fights Irish panel ruling
NEW YORK (Reuters) - Royalty Pharma, pursuing a hostile $8 billion takeover of Irish drugmaker Elan Corp Plc, moved on Tuesday to make sure it is not blocked by a potential $200 million share buyback and drug spinoff at the target company.
Elan, which has been resisting the advances of the U.S. investment firm for more than three months, rejected a sweetened takeover offer on Monday and said for the first time that it was assessing inquiries from other parties.
Royalty's new bid of $13 cash per share, plus an extra $2.50 depending on sales of the multiple sclerosis drug Tysabri, is contingent on Elan shareholders rejecting a series of four defensive transactions. The four proposals will be put to a vote of Elan shareholders at a meeting next Monday.
Royalty sought a ruling from the Irish Takeover Panel confirming that it would not be obliged to drop out if all four proposals were approved. The panel issued a ruling last week that will make Royalty's bid null and void if Elan shareholders approve either the share buyback or the drug spin-off.
"Royalty Pharma today announces that it has reluctantly filed judicial review proceedings related to the decision of the Irish Takeover Panel," the suitor said in a statement on Tuesday.
"Royalty is concerned that the Irish Takeover Panel's decision will deprive Elan shareholders of the opportunity to consider Royalty Pharma's further increased offer."
Elan shareholders will also vote on a $1 billion deal to buy 21 percent of the royalties Theravance Inc receives from GlaxoSmithKline Plc, and the $340 million acquisition of AOP Orphan, an Austrian company that focuses on rare diseases.
Royalty has urged Elan shareholders to reject all four proposals.
Sources told Reuters on Monday that Elan has attracted the interest of a number of mid-sized drug companies. Continued...