Teva (TEVA) Likely to Offer $90/Share for Mylan (MYL) in Next Step, Cowen Says

Cowen analyst Ken Cacciatore weighed in on news Mylan (NYSE: MYL) formally rejected Teva Pharma's (NYSE: TEVA) bid, saying the process is "proceeding roughly as expected and that we are witnessing the early phases of Mylan seeking to obtain the best offer possible from Teva."

While Mylan indicates is worth "significantly in excess of $100 per share" and uses language and term suggesting it should be worth roughly $120 per share or $60B, the analyst believes the next step is Teva will likely sweeten the offer to roughly $90 per share.

Cacciatore said at that point "Mylan shareholders will begin to assert pressure on management and the board to negotiate."

If Mylan does not want to engage in discussions with Teva, which seems to be the consensus opinion of what will occur, there appears to be two pathways that can be pursued: (1) Teva moves to a tender process, much like the process here in the U.S.; or (2) a shareholder, or group of shareholders that combined own 10% or more of the Mylan shares could ask for a special shareholder vote and seek to replace the Board.

Cacciatore goes on to says Mylan is a thoughtful first transaction and they believe just the beginning. He said Teva
could still move on to other assets like United Therapeutics (NASDAQ: UTHR) or Jazz (NASDAQ: JAZZ) which would bring additional accretion.

The firm maintained an Outperform rating and $100 price target on TEVA.

For an analyst ratings summary and ratings history on Teva Pharma click here. For more ratings news on Teva Pharma click here.

Shares of Teva Pharma closed at $64.41 yesterday.

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