Allergan, Ackman agree special meeting won't trigger poison pill

Fri Jun 27, 2014 1:20pm EDT
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June 27 (Reuters) - Pershing Square Capital Management, led by activist investor William Ackman, and Allergan Inc have agreed that calling a special meeting will not trigger Allergan's so-called "poison pill" measure, settling a lawsuit, the companies said on Friday.

Pershing Square and Valeant Pharmaceuticals International are pursuing Allergan in a $53 billion hostile deal. Pershing Square has nearly a 10 percent stake in Allergan and if its stake passes 10 percent, Allergan's shareholder rights plan goes into effect and dilutes existing shareholders.

Pershing Square had filed in Delaware earlier this month seeking confirmation that soliciting proxies to call a meeting and replace board members would not trigger the pill. Allergan requires 25 percent of shareholders to call a special meeting.

Pershing Square said in a statement that the agreement will allow it to begin soliciting proxies "soon". (Reporting by Caroline Humer; Editing by Marguerita Choy)