Ireland-based biotechnology firm Elan Corp. Plc (ELN) on Monday said its Board of Directors, after careful review and consideration, has unanimously rejected the takeover offer from privately held Investment firm Royalty Pharma.
According to the company, Royalty Pharma's offer, through its shell subsidiary Echo Pharma Acquisition Limited, to acquire all of the shares of Elan for $11.25 or less per share, substantially undervalues the company.
Elan Chairman Robert Ingram said, "The offer from Royalty Pharma grossly undervalues Elan's current business platform and our future prospects. As a result the Board unanimously and without reservation rejected the offer."
Elan said its Board will, in accordance with Irish Takeover Rules, communicate with shareholders again following publication of Royalty Pharma's formal Offer Document. In the meantime, Elan shareholders are strongly advised to take no action in relation to the Royalty Pharma offer.
It was in February that Royalty Pharma made an indicative proposal to acquire Elan for $11 per share. Elan's then enterprise value amounted $10.35 per share or $3.135 billion, while proposal enterprise value totaled $11 per share or $3.531 billion.
On April 15, Royalty Pharma announced a firm, all cash offer for Elan. The firm offer represents a 23 percent increase over the enterprise value of Royalty Pharma's initial proposal.
Elan's financial advisors are Citigroup, Morgan Stanley and Ondra Partners. Its legal advisors are A&L Goodbody and Cadwalader, Wickersham and Taft LLP.
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