Mylan rejects Teva’s $40.1 billion cash and stock offer

Mylan has announced that its Board of Directors has unanimously rejected the unsolicited expression of interest from Teva Pharmaceutical Industries to acquire the Company. Teva made a $40.1 billion cash and stock offer for Mylan on 21 April 2015.

If Mylan had accepted the offer, the merger would have been the biggest in the pharmaceutical industry this year.

After a comprehensive review conducted in consultation with its financial and legal advisors, the Mylan Board concluded the approach did not meet any of the key criteria that would cause the Mylan Board to consider engaging in discussions to sell the Company.

Mylan will not “entertain offers that grossly undervalue the company”

Robert J. Coury, Mylan Executive Chairman, commented, “Our Board has a very important fiduciary obligation to protect the best interests of the Company’s shareholders and other stakeholders, and has always been open to considering all paths forward in that regard, and this situation is no different. However, that does not mean we will entertain offers that grossly undervalue the company, and leave our shareholders and other stakeholders exposed to serious risk.

“After thorough consideration, Mylan’s Board unanimously determined that Teva’s proposal grossly undervalues Mylan, and would require Mylan’s shareholders to accept what we believe are low-quality Teva shares in exchange for their high-quality Mylan shares in a transaction that lacks industrial logic and carries significant global antitrust risk.  In addition, we also believe that the proposal does not address the serious challenges of integrating two fundamentally different and conflicting cultures under a Teva Board and leadership team with a poor record of delivering sustainable shareholder value. We believe that these challenges would make it very difficult to generate value from this combination for Mylan shareholders. 

“Furthermore, the proposal contains nothing meaningful indicating why a combination with Teva would be in the best interest of Mylan’s employees, patients, customers, communities and other stakeholders.  In summary, the Board determined that Teva’s expression of interest is not in the best interests of Mylan, its shareholders or other stakeholders, and we believe that this is only a mere attempt by Teva to frustrate and distract Mylan from its business plan and strategy.”

Meanwhile Mylan remains committed in its own pursuit of Perrigo in a separate $32 billion cash-and-stock proposal. This equates to $60 per Perrigo share and an offering of 2.2 Mylan shares per Perrigo share. Perrigo has issued a statement rejecting this offer and has advised shareholders to take no action in relation to the offer.