Teva CEO calls for Mylan to "engage constructively"

Teva CEO Erez Vigodman called for takeover target Mylan to "engage constructively" with the company after recently rebuffing a $40.1 billion offer and painting "a fundamentally distorted picture" of the Israeli drugmaker. Mylan rejected the bid, which was valued at $82.00 per share, as it "grossly undervalues" the drugmaker.

However, in turning down the proposal, Mylan executive chairman Robert J. Coury also said the offer included "low-quality, high-risk Teva stock," adding that it would expose the company "to a problematic culture and leadership with poor record of delivering shareholder value."

"Our respective stakeholders do not support, or benefit from, mudslinging, mischaracterisation, rehashing of history or selective presentation of facts," Vigodman wrote in a letter to Coury. "We, like every company - including yours - have had issues and front-page 'black-eyes' in the past. Our current leadership team has fully addressed these challenges and transformed Teva and it is now stronger than ever. For either of us to rehash incidents of bygone periods relating to organisations or individuals hardly does justice to our collective work," Vigodman added.

In its rebuttal, Mylan also suggested that the proposed combination would carry "significant antitrust risk and would result in massive consolidation of supply and manufacturing, creating implications for pricing power and shortages." However, Vigodman called the antitrust concerns overrated, adding "we are fully committed to pursuing this transaction and we believe the best path forward is constructive, good faith dialogue."

For related analysis, read ViewPoints: Agree to disagree – will FTC considerations scupper a Teva-Mylan deal?

Meanwhile, Perrigo recently rejected an increased offer from Mylan, under which it proposed to acquire the company for $75 in cash and 2.3 Mylan ordinary shares per Perrigo share. Perrigo said that the latest unsolicited bid "continues to propose a price lower than the previously rejected proposal," adding that shareholders should "take no action in relation to the offer."

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