The Valeant Pharmaceuticals International Inc.
anticipated an unwanted share and cash bid for Allergan. The previous year the
company made strategic decisions but these decisions were subject to persisting
delays and moreover alleged attacks by Allergan itself. What Valeant really
wanted to do was to join hands with Pershing Square Capital Management and then
collaborate to gather almost 10 percent shares of Allergan. This was before
signing an ongoing deal which caused immense pain and suffering. Before the bid
was announced Valeant Pharmaceuticals International Inc. shares were being
traded at a higher percentage.
Valeant Pharmaceuticals International Inc. is likely
to get benefits from the preparations made with Pershing Square. Through the
stakes of Allergan, Valeant Pharmaceuticals International Inc. expects a linked
connection to the shareholders of Allergan. This will result in massive number
of votes and thus eventually ruin Allergan’s defenses to the bidding. Moreover
if it a topping bid for Allergan, Valeant Pharmaceuticals International Inc.is
expected to divide the revenues on the stocks of Pershing Square’s. On the
other hand, Pershing Square is doing its best to let down Allergan and thus
wants to support Valeant acquisition and cost reducing policies. Pershing
square also decided to let go of the cash the company was providing and looked
forward to only Valeant’s stocks. But in general it seems like Valeant has lost
on a good option which could have assisted them in capitalizing the defenses on
Allergan’s weak takeover.
We all are aware of the external issues such as
pressure coming from various activists, investors; firms dealing with proxy
advisory have concluded that the results of Allergan are plundering their
takeover defenses in the previous couple of years. But the company has allowed Pershing
Square to acquire the stocks that drove Valeant right into the one area where
Allergan having residual defenses as well
Allergan
stock in its charter allows those stakeholders that have 25% of the
companies share to keep a meeting whenever required. According to Pershing
Square the laws are very complex and intricate which can result in the
cancellation of the meeting primarily because an individual violated the laws.
Using this tactic, Allergan is charging on Pershing Square and Valeant. They
believe that such accusations do not have solid grounds.
It is really easy to evaluate a takeover plan but in such a case where the takeover drags
it gives ample opportunity for the target to fight back.
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