Mylan uses independent foundation to block Teva's hostile takeover attempts

Generics specialist Mylan (Nasdaq: MYL) has moved to block a hostile takeover bid by Israeli company Teva Pharmaceutical Industries (NYSE: TEVA) by setting up an independent Dutch foundation which has exercised its call option to acquire preferred shares in Mylan.

Stichting Preferred Shares Mylan has been set up as a method of preventing the takeover by Teva. It can issue and acquire preference shares in Mylan when it deems its stakeholder interests are at risk, and plans to use its voting rights to oppose the Teva bid.

The foundation said: "Mylan and Teva, although both large and successful players in the global market for generic products, have a highly dissimilar business approach, culture, financial model and related management compensation schemes.” It will acquire 488,388,431 Mylan preferred shares, allowing it to control half the company, but will not keep the shares any longer than necessary.