Mylan Loses Monthslong Perrigo Takeover Battle

(NASDAQ:MYL), a leading manufacturer of generic drugs, were up more than 13% in early morning trading today after news was released that its most recent attempt to takeover fellow drugmaker Perrigo (NYSE:PRGO) has failed.

Close to 40% of the shareholders for Perrigo tendered shares, Mylan said on Friday in a statement, which was short of its 50% needed to move forward.

Pharmaceutical group Mylan’s offer to acquire Ireland-based Perrigo has lapsed. “These and other important factors, including those discussed under ‘Risk Factors” in the Perrigo Company’s Form 10-K for the year ended June 27, 2015, as well as the Company’s subsequent filings with the SEC, may cause actual results, performance or achievements to differ materially from those expressed or implied by these forward-looking statements.

Vice president of investor relations and global communications Arthur J. Shannon said, “This has been a great day”.

Perrigo, a leader in over-the-counter, store-brand drugs, has steadfastly resisted Mylan’s offer, arguing that it greatly overstates the potential cost savings from a merger and that Perrigo will achieve better growth on its own.

The tendered shares will now be returned, Mylan said. The county’s Economic Development Commission and agencies such as the regional Michigan Works teamed to post five billboards throughout the county touting Perrigo’s positive impact on west Michigan, all of which paired with a social media push meant to thank and reassure the company and its 4,000 employees in west Michigan.

While shares could still be tendered, many large investors would have done so by now if they wanted to accept the offer, the sources added.

As for Perrigo, it has its work cut out for it. As part of its efforts to fend off the generics giant, it last month announced plans to slash 800 jobs and kick-start a $2 billion share buyback program. The generic drugmaker wants to combine its business with Perrigo’s over-the-counter portfolio of vitamins, nutritional products and infant formula.

Perrigo has gapped open sharply lower Friday and is now down 9.55 at $147.00 on the highest volume in 7 months. Mylan contends that the Perrigo board’s inaction over the deal was a “reckless gamble” while Perrigo has criticized Mylan’s corporate governance, which it said lacks transparency.