Why Mylan is taking its Perrigo pursuit to Tel Aviv's stock exchange
- In early April, Pennsylvania-based generic and specialty drug manufacturer Mylan made a $29 billion bid to purchase Ireland-based Perrigo. Perrigo has rejected the deal many, many times.
- Now, Mylan is taking the offer directly to shareholders. The proposal is: For each share of Perrigo, Mylan will offer $75 in cash, and 2.3 Mylan shares per Perrigo share.
- Once Mylan is listed on the Tel Aviv stock exchange, Perrigo shareholders in Israel will be able to vote on the buyout offer. This will increase the likelihood that Mylan will get enough votes to go through with the deal.
- Perrigo was trying to prevent Mylan's listing on the exchange, arguing that the company likely won't offer lasting value to investors since it may ditch the exchange several years after completing a Perrigo buyout (if it goes through). But an Israeli court denied Perrigo's petition, ruling Mylan can list on the bourse.
In some ways, having Mylan list on the Tel Aviv exchange is a win-win situation for the company. It strengthens Mylan's position as it attempts to buy Perrigo and turn itself into a generics powerhouse. And on the other side, it bolsters the Israeli bourse, which has suffered from declining listings and trading volume, largely due to overzealous regulations.
Now both Perrigo and Mylan will be listed on the exchange; however, many experts predict that Mylan will delist within three years even if the Perrigo deal is completed. This M&A saga may soon be coming to an end.