DUBLIN, Aug. 14, 2015 /PRNewswire/ -- Perrigo Company plc
("Perrigo") (NYSE: PRGO; TASE) today announced that Institutional
Shareholder Services ("ISS"), the leading independent proxy
advisory firm, recommended that Mylan NV ("Mylan") (NASDAQ: MYL)
shareholders vote "AGAINST" the unsolicited offer to acquire all of
the outstanding shares of Perrigo for $75.00 per share in cash and 2.3 Mylan ordinary
shares for each ordinary Perrigo share.
The ISS report states, "Approving this proposal requires too
heavy a belief that the 'real' synergistic opportunity is much
greater than Mylan has been able to demonstrate, that these
synergistic opportunities will be realized much more quickly than
Mylan has been willing to say, that the acquisition can be
completed at a price even Mylan appears to have signaled is
unlikely to win over the requisite 80% of Perrigo shareholders, and
that an acquisition will be completed much more quickly and
smoothly than the structural issues suggest is likely."
The report concludes, "Given that the only certainty, for Mylan
shareholders, is that in approving this proposal they would sign up
for significant dilution – but have almost no subsequent leverage
to drive an optimal outcome, despite the many uncertainties to the
rest of the process – support for the proposal is not
warranted."
In its report, ISS delineates a number of specific criticisms
against the proposed transaction:
- On accretion/dilution, "Both a contribution and ROIC analysis
indicate that the transaction is barely profitable for Mylan
shareholders by year four."
- On synergies, "$800 million is
apparently the best case for synergies that Mylan could demonstrate
…by management's own prognosis, those synergies will not turn this
hugely dilutive deal accretive until year four…shareholders might
prudently ask themselves why even the best case scenario a
management team can demonstrate will still require more than three
years to become accretive."
- On leverage, "The transaction would substantially increase
leverage at Mylan. Net debt/ 2015 EBITDA would increase from the
current 2.9x to 5.3x after closing of the transaction."
- On governance, "Mylan may actually trade at a larger discount
(and thus lower multiple) due to investors' more dim view of its
corporate governance."
Commenting on the ISS report, Perrigo Chairman, President and
CEO Joseph C. Papa stated, "The ISS
recommendation is consistent with our view that Mylan's offer would
be value destructive and that Perrigo and Mylan holders alike
should not support this transaction. As we have said since April,
Mylan's offer substantially undervalues Perrigo and is not in the
best interests of our shareholders. Following Mylan's action to
recklessly lower the acceptance threshold, which makes an already
value destructive deal even worse, this transaction exposes
shareholders to dilution, enhanced risk and a questionable synergy
target."
Papa continued, "The report also underscores Mylan's poor
corporate governance track record. Ultimately, we do not
believe that Perrigo shareholders will tender into this transaction
— whether at 80% or 50% -- and ISS's recommendation only further
reinforces our view that Mylan's approach demonstrates an act of
desperation as there is no rational path to a full acquisition of
Perrigo."
Papa concluded, "As our recent accretive acquisitions of a
number of well-established European OTC brands demonstrate, we
continue to execute on our standalone 'Base Plus Plus Plus'
strategy. Perrigo's experienced management team has an outstanding
record for creating value, and I believe that Perrigo is well
positioned to continue generating superior shareholder
returns."
Forward Looking Statements
Certain statements in this press release are forward-looking
statements. These statements relate to future events or the
Company's future financial performance and involve known and
unknown risks, uncertainties and other factors that may cause the
actual results, levels of activity, performance or achievements of
the Company or its industry to be materially different from those
expressed or implied by any forward-looking statements. In some
cases, forward-looking statements can be identified by terminology
such as "may," "will," "could," "would," "should," "expect,"
"plan," "anticipate," "intend," "believe," "estimate," "predict,"
"potential" or other comparable terminology. The Company has based
these forward-looking statements on its current expectations,
assumptions, estimates and projections. While the Company believes
these expectations, assumptions, estimates and projections are
reasonable, such forward-looking statements are only predictions
and involve known and unknown risks and uncertainties, many of
which are beyond the Company's control, including future actions
that may be taken by Mylan in furtherance of its unsolicited
proposal. These and other important factors, including those
discussed under "Risk Factors" in the Company's Form 10-K for the
year ended June 28, 2014, as well as
the Company's subsequent filings with the Securities and Exchange
Commission, may cause actual results, performance or achievements
to differ materially from those expressed or implied by these
forward-looking statements. The forward-looking statements in this
press release are made only as of the date hereof, and unless
otherwise required by applicable securities laws, the Company
disclaims any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.
Additional Information and Where to Find It
The exchange offer for the outstanding shares of Perrigo
described herein has not yet commenced. If and when an exchange
offer by Mylan is commenced, Perrigo intends to file a
solicitation/recommendation statement with respect to such exchange
offer with the Securities and Exchange Commission ("SEC"). Security
holders are urged to read the solicitation/recommendation statement
and other relevant materials if and when they become available
because they will contain important information. The
solicitation/recommendation statement and other SEC filings made by
Perrigo may be obtained (when available) without charge at the
SEC's website at www.sec.gov and at the investor relations
section of the Perrigo website at perrigo.investorroom.com.
Irish Takeover Rules
The directors of Perrigo accept responsibility for the
information contained in this announcement. To the best of the
knowledge and belief of the directors of Perrigo (who have taken
all reasonable care to ensure such is the case), the information
contained in this announcement is in accordance with the facts and
does not omit anything likely to affect the import of such
information.
A person interested in 1% or more of any class of relevant
securities of Perrigo or Mylan may have disclosure obligations
under Rule 8.3 of the Irish Takeover Panel Act, 1997, Takeover
Rules, 2013 ("Irish Takeover Rules").
No statement in this communication is intended to constitute a
profit forecast for any period, nor should any statements be
interpreted to mean that earnings or earnings per share will
necessarily be greater or lesser than those for the relevant
preceding financial periods. No statement in this communication
constitutes an asset valuation.
About Perrigo
Perrigo Company plc, a top five global over-the-counter (OTC)
consumer goods and pharmaceutical company, offers consumers and
customers high quality products at affordable prices. From its
beginnings in 1887 as a packager of generic home remedies, Perrigo,
headquartered in Ireland, has
grown to become the world's largest manufacturer of OTC products
and supplier of infant formulas for the store brand market. The
Company is also a leading provider of branded OTC products, generic
extended topical prescription products and receives royalties from
Multiple Sclerosis drug Tysabri®. Perrigo provides "Quality
Affordable Healthcare Products®" across a wide variety of product
categories and geographies primarily in North America, Europe, and Australia, as well as other key markets
including Israel and China. Visit Perrigo online at
(http://www.perrigo.com).
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SOURCE Perrigo Company plc