The Dublin-based biotech company said it has instructed its advisers — which include Davy Corporate Finance, A&L Goodbody, Citigroup and Morgan Stanley — to assess all expressions of interest that reflect “the intrinsic value” of the company.
That statement formed part of the company’s formal rejection yesterday of the latest revised takeover approach from Royalty Pharma. The rejection said Royalty “continues to grossly undervalue” the anticipated future royalty stream due from Tysabri, the multiple sclerosis treatment out of which Elan recently sold out.
In the escalating war of words between the two companies — ahead of a crucial EGM next Monday — Royalty retaliated by calling Elan’s recently announced shareholder resolutions “misguided” and accusing the Elan board of being “hopelessly entrenched”.
Elan’s shareholders are set to vote next week on a range of proposals — including royalty and company acquisitions and an additional share buyback — any of which being approved will signal Royalty walking away from the process. Yesterday, the New York-based company again urged Elan’s shareholders to vote against the proposals but last week only had 7.5% backing.
Royalty has been circling Elan since February and, last week, upped its bid to $13 (€9.80) per share, plus an extra $2.50 per share based on specific sales targets being met by Tysabri over the next five years.
In its statement yesterday, Elan said the value gap between Elan and the Royalty bid “remains significant”, with the latest bid “wholly inadequate”.
Royalty said Elan’s recent transactions — set for the shareholder vote next Monday — “lack financial justification” and were undertaken solely to fend off Royalty’s increased offer.
“Elan’s board is hopelessly entrenched and appears to be doing everything it can to deny Elan shareholders the opportunity to consider Royalty Pharma’s offer,” said the US firm’s chairman, Rory Riggs.