Valeant Pharmaceuticals (VRX) Offers to Acquire ISTA Pharmaceuticals Inc. (ISTA) for $6.50/Share
Tweet
Share
E-mail
Valeant Pharmaceuticals International, Inc. (NYSE: VRX) (TSX: VRX) today announced that it had made a proposal to the Board of Directors of ISTA Pharmaceuticals Inc. (Nasdaq: ISTA) to acquire ISTA for $6.50 per share in cash. The proposed transaction has a total equity value of approximately $314 million on a fully diluted basis. In addition, ISTA has net debt of approximately $13 million, bringing the total enterprise value to approximately $327 million. This proposed price represents a premium of approximately 68% over ISTA's 60-day volume weighted trading average of $3.87 and a premium of approximately 67% over ISTA's closing price of $3.89 on December 15, 2011. Valeant's Board of Directors unanimously supports this proposal.
Preferring a consensual process, Valeant approached ISTA on October 5, 2011. After ISTA refused to enter into a customary confidentiality agreement with Valeant, Valeant made a formal written proposal to ISTA's management on November 23, 2011. ISTA responded to this letter on December 2, 2011, stating that it needed more time to review Valeant's proposal. Valeant reaffirmed its proposal to ISTA on December 12, 2011 in writing, and ISTA rejected this proposal on December 14, 2011. Valeant is disappointed by ISTA's rejection of its proposal and ISTA's unwillingness to engage in discussions. Copies of the three letters from Valeant to ISTA are attached to this press release.
"The proposed $6.50 per share price represents a meaningful premium to ISTA's recent trading performance, and we believe it represents a compelling opportunity for ISTA's shareholders in light of the continuing challenges facing ISTA," stated J. Michael Pearson, chairman and chief executive officer of Valeant. "We would be willing to consider improving our offer price if we were allowed to conduct due diligence and found additional value. Given the importance of the proposed transaction to shareholders of both companies, we have decided to make our proposal public. We believe ISTA stockholders should not be denied the opportunity to determine for themselves whether their board and management should engage with Valeant in a meaningful and productive dialogue regarding our proposal. We have already devoted significant time and resources to pursing this potential transaction. Therefore, consistent with our past disciplined approach to acquisitions, our $6.50 offer will only remain in effect until January 31, 2012."
Preferring a consensual process, Valeant approached ISTA on October 5, 2011. After ISTA refused to enter into a customary confidentiality agreement with Valeant, Valeant made a formal written proposal to ISTA's management on November 23, 2011. ISTA responded to this letter on December 2, 2011, stating that it needed more time to review Valeant's proposal. Valeant reaffirmed its proposal to ISTA on December 12, 2011 in writing, and ISTA rejected this proposal on December 14, 2011. Valeant is disappointed by ISTA's rejection of its proposal and ISTA's unwillingness to engage in discussions. Copies of the three letters from Valeant to ISTA are attached to this press release.
"The proposed $6.50 per share price represents a meaningful premium to ISTA's recent trading performance, and we believe it represents a compelling opportunity for ISTA's shareholders in light of the continuing challenges facing ISTA," stated J. Michael Pearson, chairman and chief executive officer of Valeant. "We would be willing to consider improving our offer price if we were allowed to conduct due diligence and found additional value. Given the importance of the proposed transaction to shareholders of both companies, we have decided to make our proposal public. We believe ISTA stockholders should not be denied the opportunity to determine for themselves whether their board and management should engage with Valeant in a meaningful and productive dialogue regarding our proposal. We have already devoted significant time and resources to pursing this potential transaction. Therefore, consistent with our past disciplined approach to acquisitions, our $6.50 offer will only remain in effect until January 31, 2012."
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Holcim to acquire Fermacell from James Hardie for EUR 840M
- Bernstein on whether Hershey (HSY) could eventually step up to buy Mondelez (MDLZ)
- Sempra sells Mexican gas distributor Ecogas for ~$500M
Create E-mail Alert Related Categories
Hot M&A, Mergers and AcquisitionsSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
