JERUSALEM—In the latest multibillion-dollar offer of 2015, Teva Pharmaceutical Industries Ltd. has announced a proposal to acquire all of Mylan N.V.'s outstanding shares for $82 per share, to be paid in a mixture of approximately 50 percent cash and 50 percent stock, for a total deal value of nearly $40 billion. Teva's board of directors has unanimously approved the proposal.
“Our companies share years of experience and success leading the generic industry and building strong presences in specialty and biologics,” Erez Vigodman, president and CEO of Teva, said in a press release. “Both Teva and Mylan have achieved their respective goals through innovation, vision and a commitment to quality. Mylan’s business is a natural fit with our own and is highly complementary to it – and bringing together our two companies would not only deliver the greatest value for our financial stakeholders, but also enable us to better serve patients, customers and healthcare systems throughout the world. We are confident that any regulatory requirements necessary to complete a combination with Mylan will be met in a timely manner, enabling us to realize compelling value for stockholders of both Teva and Mylan.”
According to Teva, the combination would result in “an industry-leading company well-positioned to transform the generics spaces,” one with an expanded, efficient global footprint and operations, sales and R&D platforms. It would have what Teva deems “the broadest portfolio in the industry, with a combined pipeline of over 400 pending ANDAs and over 80 first-to-files in the U.S.” Teva expects the combined company could see revenues of more than $30 billion in 2016, with EBITDA of more than $10 billion, numbers that Teva forecasts could rise to $33 billion and $13 billion, respectively, by 2018. In addition, Teva expects to see cost synergies and tax savings of approximately $2 billion annually, which would most likely be achieved by the third year after the deal closes.
“Our proposal is compelling for both Teva and Mylan stockholders and other stakeholders,” Vigodman added. “Our proposal would provide Teva stockholders with very attractive strategic and financial benefits and Mylan stockholders with a substantial premium and immediate value for their shares, as well as the opportunity to participate in the significant upside potential of the combined company – one that would transform the global generics space and leverage it to hold a unique leadership position in the pharmaceutical industry. We have long respected Mylan’s business, and we are confident that Mylan’s board of directors and stockholders will agree that our proposal represents a significantly more attractive alternative for Mylan and its stockholders than Mylan’s proposed acquisition of Perrigo.”
The proposal is subject to customary closing conditions, and Teva believes the deal could be completed by the end of the year. While this transaction would not require a financing condition or a vote by Teva stockholders, it is contingent on Mylan not going through with its proposed acquisition of Perrigo.
While Mylan has yet to comment on the official proposal, on April 17 the company posted a statement regarding media speculation that Teva would make a bid. Robert J. Coury, executive chairman of Mylan, said that “Mylan is fully committed to its stand-alone strategy, including its proposal to acquire Perrigo, and today's speculation has no impact whatsoever on this strategy. We have studied the potential combination of Mylan and Teva for some time and we believe it is clear that such a combination is without sound industrial logic or cultural fit. Further, there would be significant overlap in the companies' businesses, and we believe that it is unlikely that any such combination could obtain anti-trust regulatory clearances.”
Coury added that should any offer be made, Mylan's board would “carefully consider it in exercising its fiduciary duties in the best interests of the company, our stockholders and other stakeholders,” but noted that Mylan “will maintain our unwavering focus on executing on our business plan and concluding a successful transaction with Perrigo.”
Mylan announced its non-binding proposal for Perrigo Co. plc on April 8, offering $205 per share of Perrigo stock (to be paid in a combination of cash and Mylan stock), a deal with a total consideration of approximately $29 billion. (Read more about that deal here: Mylan announces $29B acquisition proposal for Perrigo) Perrigo has yet to make an official response to the proposal, save for announcing that it had received the proposal and that its board would be meeting to discuss the offer.
SOURCE: Teva press release