Elan Corp. dropped a lawsuit seeking to block Royalty Pharma AG’s $6.4 billion hostile takeover bid after Royalty Pharma provided additional information about its plans for the Irish drugmaker.
Elan filed papers today in Manhattan federal court withdrawing its lawsuit. U.S. District Judge William Pauley issued a temporary order on June 3, the same day the suit was filed, blocking Royalty Pharma’s tender offer. Today’s move avoids a hearing scheduled for tomorrow in which Pauley was to consider extending the injunction.
Elan, which is resisting the takeover, argued that Royalty Pharma’s tender offer was “coercive” and claimed that the investment firm made material misrepresentations in papers describing its offer. Elan withdrew the suit after Royalty Pharma provided additional details of its bid last week.
“Elan is withdrawing its complaint before the court because Royalty Pharma, in response to Elan’s complaint, was forced to revise its tender offer documents to provide significant amounts of additional information” in new documents filed with the Securities and Exchange Commission June 7.
Royalty Pharma last week raised its bid for Dublin-based Elan to $13 for each American depository receipt from $12.50, or $6.7 billion. The new proposal would value Elan shares at as much as $15.50 if the company’s multiple sclerosis drug Tysabri hits specified sales and development targets.
Elan’s board unanimously rejected the new tender offer, the company said in a statement today.
Elan shareholders will vote on four transactions tied to the Royalty Pharma offer on June 17. The company was represented in the New York suit by the law firm Cadwalader, Wickersham & Taft LLP.
The case is Elan Corp. v. RP Management LLC, 13-cv-03758, U.S. District Court, Southern District of New York (Manhattan).