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Wells Fargo Analyst Michael Ton Says Valeant May Have to Raise Offer for Obagi or Walk Away

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In a note from Wells Fargo analyst Michael Ton, concern is being raised over the current $19.75 per share offer from Valeant Pharmaceuticals (NYSE: VRX) for Obagi (NASDAQ: OMPI).

Concerns come from a recent offer by Merz Pharma, which may force Valeant to raise its offer, cut into margins or abandon the acquisition all together.

Tong went on to note that Valeant has a history of walking away from competitive bidding.

Following the news, Valeant Pharma traded roughly flat, while Obagi traded up 16.24 percent to $22.91.

Latest Ratings for VRX

DateFirmActionFromTo
Dec 2016Morgan StanleyDowngradesOverweightEqual-Weight
Nov 2016MizuhoDowngradesNeutralUnderperform
Nov 2016Rodman & RenshawDowngradesBuyNeutral

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