Mylan takes takeover bid to Perrigo shareholders

Pharmaceutical company Mylan said Tuesday that it would take its offer to buy Perrigo directly to Perrigo shareholders following refusals by the company's management to engage in merger talks.

Mylan, a large generic drugs company, will launch the offer to Perrigo shareholders on Monday and Perrigo shareholders will be eligible to vote until November 13. Perrigo makes over-the-counter medications such as Claritin and Sudafed.

Mylan has proposed $75 in cash and 2.3 Mylan shares for each Perrigo share. Perrigo shareholders would own about 40 percent of the combined company. Mylan said the transaction values Perrigo at $31.8 billion, based on Mylan's closing share price Friday.

Mylan initially approached Perrigo in April with a takeover deal that it valued at the time at $35.7 billion, but since then Mylan's shares have fallen.

Perrigo has repeatedly said the Mylan bid "substantially undervalues" the company, reiterating that stance on August 28 after two-thirds of Mylan shareholders voted in favor of the proposed takeover of Perrigo.

Mylan executive chairman Robert Coury said in a letter to Perrigo chief executive Joseph Papa that the outcome now rests with Perrigo shareholders.

"You and your Board are now unable to stop the combination," Coury said.

"At this point Perrigo's management has no role to play in the process, and the only role the Perrigo Board has is to issue its recommendation to Perrigo shareholders."

In mid-morning trade, Perrigo shares rose 1.2 percent to $180.92, while Mylan shares rose 0.7 percent to $48.36.