On Friday Mylan NV shareholders took a vote which favored the company’s proposed $35.6 billion bid for Perrigo Co.
The bid would aid the generic-drug maker in an attempted aggressive overthrow of its rival. The bid received approval from two-thirds of the votes at the shareholder meeting, adding that they won support from the majority of the company’s shares outstanding but did not release any specific numbers, according to The Wall Street Journal.
Mylan is able to now bypass Perrigo’s management and board and drill directly to its shareholders in the next few weeks in order to secure approval for the acquisition of the company. It will be a hostile takeover if successful, seeing that Perrigo has rebuffed all of their advances thus far.
“Following extensive discussions with our shareholders, we are confident that most of them believe that Mylan’s offer substantially undervalues Perrigo and would dilute our growth profile and superior valuation,” Perrigo said after the vote.
Mylan Executive Chairman Robert J. Coury is counting victory already. He recently ignited a $40 billion takeover offer from Teva Pharmaceutical Industries Ltd. right after he announced Mylan’s interest in Perrigo. But Mylan rejected Teva’s offer which led them to buy Allergan PLC’s generic-drug business at $40.5 billion.
Mylan’s first attempt to go after Perrigo, and its rejection to it, was in April offering a $28.9 billion bid with the idea on the table to convince Perrigo of the much-needed consolidation in the overcrowded generics sector.
Perrigo was not the only one contesting the bid, but the Institutional Shareholder Service Inc. recommended that Mylan shareholders vote against it as well pointing out that the financial benefits of the deal were not compelling enough versus its industrial logic.
But others are in favor. The founder of hedge fund Paulson & Co., John Paulson, owns shares in both companies and expressed his support of the deal as well as another big Mylan shareholder, Abbott Laboratories.
While Mylan is known to its top-selling generic prescription drugs and Perrigo makes over-the-counter cough-and-cold remedies for chains, the combination of the two companies would spawn one of the world’s top sellers of low-price medicines with over $15 billion in annual sales.