Aug. 23 (Bloomberg) -- Valeant Pharmaceuticals International Inc. and Pershing Square Capital Management said 31 percent of Allergan Inc.’s shareholders support their effort to call a special meeting as part of Valeant’s $54 billion takeover bid for the maker of the Botox anti-wrinkle cream.
The sides have fought for months, trading allegations and lawsuits as Irvine, California-based Allergan repeatedly rejected Valeant’s unsolicited offer. Pershing Square, the hedge fund led by Bill Ackman, and Valeant said yesterday they have written requests from more than 25 percent of investors as required under Allergan’s bylaws to force a shareholder meeting.
Valeant, based in Laval, Quebec, is seeking Allergan to expand its portfolio and become one of the world’s largest drug makers. David Pyott, Allergan’s chief executive officer, has fought to keep the company independent, announcing a restructuring including cutting 1,500 jobs.
“The degree of support received is remarkable in light of the extraordinarily burdensome requirements that shareholders have had to meet to deliver their consents,” Ackman said in a statement. “No special meeting has ever been called with shareholders being required to comply with such onerous procedural and informational requirements.”
Two shareholder advisory groups have recommended that Allergan investors back the special meeting pushed by Ackman. The activist investor wants to add six new Allergan board members and push through the deal with Valeant. Valeant has offered $72 in cash and 0.83 of a Valeant share for each Allergan share.
Allergan confirmed it had received the documents requesting the special meeting and said the board still considers Valeant’s offer “grossly inadequate.”
“Stockholders were asked to evaluate if they wanted the opportunity to vote on the offer at a later date; not to evaluate the merits of the offer itself,” Allergan said in a statement. “In fact, many stockholders have explicitly conveyed their view that the requests are not an endorsement of Valeant’s offer.”
The company said it was evaluating the documents and would announce additional details regarding the special meeting later. Valeant and Ackman said the board must call the special meeting no later than Dec. 20.
“We remain firmly committed to pursuing a merger of Valeant and Allergan and are greatly appreciative of the shareholder support received to call the meeting,” Michael Pearson, Valeant’s CEO, said in the statement. “We look forward to the opportunity to negotiate a transaction which is in the best interest of both companies.”