BioCentury
ARTICLE | Company News

Elan buys back $1B in stock, Royalty Pharma ups bid

April 19, 2013 12:16 AM UTC

Elan Corp. plc (NYSE:ELN) used $1 billion to repurchase 88.9 million shares, or about 14.8%, at $11.25 in a Dutch auction. The price was at the low end of the company's $11.25-$13 proposed range and is a 2% discount to Elan's close of $11.42 on March 7, the day before the auction was announced. Elan repurchased about 82 million shares tendered by its largest shareholder, Johnson & Johnson (NYSE:JNJ). J&J, which had been seeking to sell its entire 18% stake or about 107.4 million shares, now has a 4.9% stake in Elan.

Separately, Royalty Pharma (New York, N.Y.) said it will increase its offer to acquire Elan to $11.25 from $11 to match the repurchase price. The price values the biotech at $5.7 billion, based on an expected 510 million shares to be outstanding after the share repurchase. Royalty Pharma said it will now file a formal tender offer, but declined to provide details (see BioCentury Extra, April 15). ...