Allergan takeover battle drags on

In a solicitation statent filed with the United States Securities and Exchange Commission, hedge fund Pershing Square Capital Managent, which owns 9.7% or Allergan, wants to call the special meeting of Allergan shareholders to rove current mber of the board and request that it promptly engage in good faith discussions with Valeant in regard to the latter’s offer to merge.In response, Allergan is urging shareholders to refrain from any action, including returning any proxy card sent by co-holders Pershing Square and Valeant and waiting until the matter is reviewed by Allergan’s directors and until proxy solicitation materials are provided.The takeover offer has been increased to $US72 per share plus 0,83 shares of Valeant stock per Allergan share.If Pershing Square gets its way, a special meeting could be held on 7 August.In the midst of the hostile bid for Allergan, activist investor Mr Bill Ackman said shareholders are willing to hand over the company for $180 per share, just about in line with the latest offer from Valeant and Mr Ackman’s Pershing Square.On 16 June, Allergan reiterated its concerns about Valeant’s unsustainable business model, that time invoking analysts, media and the like to underscore its point.Valeant CEO Michael Pearson’s operation is a house of cards , Morgan Stanley says and it depends on people continuing to drink this Kool Aid Gimme Credit analyst Vicki Bryan said. Something from the Wizard of Oz, Bronte Capital said.ReleaseValeant has already faced criticism from Allergan about its significant managent turnover , and now the Botox-maker has more ammunition. EVP and company group chairman Ryan Weldon is on his way out, Valeant confirmed Friday; the company says Weldon’s departure was planned and will take effect after Valeant closes the $1.4 billion sale of several injectable treatments to Nestlé.

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