Corporate Banner
Satellite Banner
Technology
Networks
Scientific Communities
 
Become a Member | Sign in
Home>News>This Article
  News
Return

Perrigo Company to Acquire Elan Corporation, Plc for Us$8.6 Billion

Published: Tuesday, July 30, 2013
Last Updated: Tuesday, July 30, 2013
Bookmark and Share
Acquisition establishes a differentiated platform for further international expansion.

Perrigo Company and Elan Corporation, plc announced that, following a formal sale process conducted by Elan, Perrigo and Elan have entered into a definitive agreement (the “Transaction Agreement”) under which Elan will be acquired by a new holding company incorporated in Ireland. The cash and stock transaction, which is valued at approximately US$8.6 billion based on the closing price of Perrigo shares on 26 July 2013 (US$6.7 billion excluding Elan’s cash on hand), will create a global healthcare company with an industry-leading growth profile and the geographic scale and scope to continue building a truly differentiated business.

“Through this transaction, Perrigo establishes a diversified platform for further international expansion,” stated Perrigo Chairman and CEO, Joseph C. Papa. “We believe this transaction is compelling for Elan shareholders and fully takes into account the value of Elan’s assets, including a large cash balance and a double-digit royalty claim on Tysabri®, a blockbuster product that generated revenues of US$1.6 billion last year and has been growing at a compound annual growth rate of 19%. We believe the combination of Perrigo and Elan will create an industry-leading global healthcare company with the balance sheet liquidity and operational structure to accelerate our growth and capitalize on international market opportunities.”

Mr. Robert A. Ingram, Chairman of Elan, commented, “This is an excellent transaction for Elan shareholders and provides them with cash consideration as well as the opportunity to benefit from the potential upside value of the new company. Joe Papa and his team have demonstrated exceptional capability and delivery of results in building a premier healthcare company over the past number of years. We have the confidence in Joe and his leadership team to continue to grow and expand its presence on a global scale.”

Additionally, Elan CEO Mr. G. Kelly Martin, said, “The Elan platform has been constructed over the years to provide a unique and compelling investment thesis for our shareholders. This transaction underscores the tremendous value of Elan's platform. The new combined company should deliver value, growth and diversification to shareholders for many years to come.”

The proposed transaction, which has been unanimously approved by the respective boards of directors of Perrigo and Elan, is expected to close by the end of calendar year 2013. At the close of the transaction, Perrigo and Elan will be combined under New Perrigo, a new company incorporated in Ireland, where Elan is incorporated today. New Perrigo, which is expected to be called Perrigo Company plc or a variant thereof, will be led by Perrigo’s current leadership team.

Elan’s current business portfolio includes royalties from Multiple Sclerosis (MS) treatment Tysabri® (marketed and distributed by Biogen Idec, Inc.), along with a neuropsychiatric pipeline with near term value-creating opportunities. Tysabri® had a 19% compound annual growth rate over the 2008–2012 period. Elan currently earns a 12% royalty on global net sales of Tysabri®. From 1 May 2014 onwards, the royalty increases to 18% on annual net sales up to US$2.0 billion, and to 25% on annual net sales above this amount. The Tysabri® cash flows are highly sustainable with multiple barriers to entry, analogous to the fundamentals of Perrigo’s core business. Further upside exists if Tysabri® is approved for Secondary Progressive MS.

Under the terms of the Transaction Agreement, at the closing of the acquisition, Elan shareholders will receive US$6.25 in cash and 0.07636 shares of New Perrigo for each Elan share. The transaction values each Elan share at US$16.50 based on the closing price of Perrigo shares on 26 July 2013, which represents a premium of approximately 10.5% compared to the closing price of Elan American Depositary Shares on 26 July 2013, the last trading day prior to the date of this announcement. The transaction values the entire share capital of Elan at approximately US$8.6 billion based on Perrigo’s closing share price on 26 July 2013. Net of cash, the transaction is valued at US$6.7 billion. Perrigo shareholders will receive one share of New Perrigo for each share of Perrigo that they own upon closing and US$0.01 per share in cash. The transaction will be taxable, for U.S. federal income tax purposes, to both the Elan shareholders and the Perrigo shareholders.

Immediately after the closing of the transaction, Perrigo shareholders are expected to own approximately 71% of the combined company while Elan shareholders are expected to own approximately 29%. Shares of New Perrigo will be registered with the U.S. Securities and Exchange Commission (the “SEC”) and are expected to trade on the New York Stock Exchange and the Tel Aviv Stock Exchange.


Further Information

Join For Free

Access to this exclusive content is for Technology Networks Premium members only.

Join Technology Networks Premium for free access to:

  • Exclusive articles
  • Presentations from international conferences
  • Over 3,000+ scientific posters on ePosters
  • More Than 4,400+ scientific videos on LabTube
  • 35 community eNewsletters


Sign In



Forgotten your details? Click Here
If you are not a member you can join here

*Please note: By logging into TechnologyNetworks.com you agree to accept the use of cookies. To find out more about the cookies we use and how to delete them, see our privacy policy.


Scientific News
Releasing Cancer Cells for Better Analysis
A new device developed at the University of Michigan could provide a non-invasive way to monitor the progress of an advanced cancer treatment.
Releasing Cancer Cells for Better Analysis
A new device developed at the University of Michigan could provide a non-invasive way to monitor the progress of an advanced cancer treatment.
Apricot Kernels Pose Risk of Cyanide Poisoning
Eating more than three small raw apricot kernels, or less than half of one large kernel, in a serving can exceed safe levels. Toddlers consuming even one small apricot kernel risk being over the safe level.
Cell Transplant Treats Parkinson’s in Mice
A University of Wisconsin—Madison neuroscientist has inserted a genetic switch into nerve cells so a patient can alter their activity by taking designer drugs that would not affect any other cell.
Understanding Female HIV Transmission
Glowing virus maps points of entry through entire female reproductive tract for first time.
Genetic Markers Influence Addiction
Differences in vulnerability to cocaine addiction and relapse linked to both inherited traits and epigenetics, U-M researchers find.
Lab-on-a-Chip for Detecting Glucose
By integrating microfluidic chips with fiber optic biosensors, researchers in China are creating ultrasensitive lab-on-a-chip devices to detect glucose levels.
A lncRNA Regulates Repair of DNA Breaks in Breast Cancer Cells
Findings give "new insight" into biology of tough-to-treat breast cancer.
COPD Linked to Increased Bacterial Invasion
Persistent inflammation in COPD may result from a defect in the immune system that allows airway bacteria to invade deeper into the lung.
Detection of HPV in First-Void Urine
Similar sensitivity of HPV test on first void urine sample compared to cervical smear.
Scroll Up
Scroll Down
Skyscraper Banner

Skyscraper Banner
Go to LabTube
Go to eposters
 
Access to the latest scientific news
Exclusive articles
Upload and share your posters on ePosters
Latest presentations and webinars
View a library of 1,800+ scientific and medical posters
3,000+ scientific and medical posters
A library of 2,500+ scientific videos on LabTube
4,400+ scientific videos
Close
Premium CrownJOIN TECHNOLOGY NETWORKS PREMIUM FOR FREE!