Elan details further inadequacy of Royalty Pharma's revised offer; takes legal action

The saga of Royalty Pharma’s hostile attempts to acquire Ireland-headquartered Elan Corp (NYSE: ELN) continues, with Elan issuing a formal response document to the US private equity firm’s revised offer made on May 23. The Irish drugmaker is also suing Royalty Pharma in a New York federal court seeking to block what it described as a "coercive" tender that gives stockholders until June 6 to determine whether or not to waive their shares.

The response document details why Elan believes Royalty Pharma’s current offer of $12.50 per share substantially undervalues Elan, and how Elan’s recently announced transactions further widen the gap between Royalty Pharma’s undervalued offer and the fair value of Elan shares, reiterating much of what it said in a recent re-evaluation of the drugmaker, saying its share are worth at least $15.50 and as much as $20.80 (The Pharma Letter May 30).

Deliberately misleading investors