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Mylan NV MYL shares have slipped 13 percent this year, while Perrigo Company plc Ordinary Shares PRGO shares have gained 8 percent.
- In an expected move, Mylan offered a combined cash and stock offer of $186.895 for Perrigo, which included $75 in cash and 2.3 Mylan shares for each Perrigo share.
- Umer Raffat at Evercore ISI said that this latest offer may lead Perrigo to start a "process for sale" or "attempt a large transaction" themselves.
Mylan on Monday officially offered to buy Perrigo for $75 in cash and 2.3 Mylan shares per Perrigo share, an offer of $186.895 per share. Based off Friday's closing price, that represents just a 4 percent premium to the $179.67 closing price. According to Raffat at Evercore ISI, this ups the pressure on Perrigo management. Raffat said that from conversations with investors, Perrigo may either start a process for sale or attempt a large transaction of its own.
Perrigo management had previously told Mylan that their initial bids undervalued the company. Following that, Mylan shareholders approved a vote to pursue a hostile bid for the company in an August shareholder meeting.
The price of the deal has come down substantially from Mylan's initial April $205 per share offer, following a 35 percent decline in Mylan's share price from late April.
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