Elan raises $850M, rejects Royalty offer
Elan Corp. plc (NYSE:ELN) raised $850 million in a bumped-up notes deal on Thursday, and the biotech's board also unanimously rejected a revised offer from Royalty Pharma (New York, N.Y.) to acquire the company. Elan proposed to raise $800 million in the note deal on Monday, alongside proposed moves for a spinout, a $200 million share buyback and the acquisition of two companies. Royalty subsequently raised its offer to acquire Elan to $12.50 per share from $11.25, valuing Elan at $6.4 billion (see BioCentury Extra, May 20).
On Thursday, Royalty said it lowered to 50% plus a share from 90% the number of Elan shares that must be tendered for Royalty to consider the tender successful. Royalty's bid is contingent on Elan shareholders rejecting Monday's deals, as well as this month's proposed deal to pay Theravance Inc. (NASDAQ:THRX) $1 billion in cash in exchange for a 21% interest in the royalties Theravance is eligible to receive from partner GlaxoSmithKline plc (LSE:GSK; NYSE:GSK) for four respiratory programs (see BioCentury, May 20). ...