Mylan is offering $30bn to buy out the generics, OTC and branded US specialist firm Perrigo.
Mylan, itself a generic pharma firm, has offered acquire Perrigo in a cash-and-stock transaction worth $205 a share.
The combination of the complementary businesses would help create a company with a strong foothold in specialty brands, generics, a world-leader in over-the-counter (OTC) medicines, and nutritional products.
Under the terms of the non-binding proposal, which was delivered to Perrigo’s chairman on April 6, Perrigo shareholders would receive $205 in a combination of cash and Mylan stock for each Perrigo share.
This represents a greater than 25% premium to the Perrigo trading price as of the close of business on Friday, April 3, 2015 (the last trading date prior to the date of Mylan’s proposal).
This is also a greater than 29% premium to Perrigo’s sixty-day average share price and a greater than 28% premium to Perrigo’s ninety-day average share price.
Mylan’s executive chairman Robert Coury, said: “This proposal is the culmination of a number of prior discussions between Mylan and Perrigo about the compelling strategic and financial logic of this combination. This combination would result in meaningful immediate and long-term value creation, and our proposal is designed to deliver that value to shareholders and other stakeholders of both companies.
“We have great respect for Perrigo’s board and management team and what they have built. We look forward in the weeks ahead to working with them to capitalize on this tremendous opportunity and working together to create a unique leader with a one-of-a-kind profile in our industry.”
Perrigo has itself made some significant acquisitions over the past two years, buying OTC drugmaker Omega for $5.3bn last year, a year after paying $8.6bn for Elan, which focuses on patented medicines for MS and autoinflammatory disorders.
Mylan has also been on the acquisition trail, signing a deal to run Abbott’s generics business in Europe last year.