Aug. 26 (Bloomberg) -- Allergan Inc. says Valeant Pharmaceuticals International Inc. and Pershing Square Capital Management want a judge in September to review demands that the maker of the Botox anti-wrinkle cream call a special shareholder meeting as part of Valeant’s $54 billion takeover bid.
Valeant and Pershing Square, a hedge fund run by Bill Ackman, are asking Delaware Chancery Judge Andre Bouchard to set a trial for Sept. 24 on whether they properly secured support of enough Allergan stockholders to force a meeting of investors to consider replacing a majority of the company’s directors, according to court filings.
The sides have fought for months, trading allegations and lawsuits as Irvine, California-based Allergan repeatedly rejected Valeant’s unsolicited buyout offers. Allergan executives have set the shareholder meeting for Dec. 18, and Valeant officials and Ackman want Bouchard to clear the way for it to be held almost three months earlier, court filings show.
The demand for an expedited hearing is “accompanied by no showing of urgent need” to speed up scheduling of the shareholder meeting, Allergan’s lawyers said today in court papers. Valeant and Ackman asked Bouchard to weigh whether they had complied with Allergan’s bylaws in lining up shareholder support for the meeting in a November trial.
Valeant, based in Laval, Quebec, wants Irving, California-based Allergan to expand its portfolio and become one of the world’s largest drug makers. David Pyott, Allergan’s chief executive officer, has fought to keep the company independent, announcing a restructuring including cutting 1,500 jobs.
Valeant and Pershing Square officials said they delivered papers indicating more than 30 percent of Allergan shareholders backed calling a special investor meeting to the takeover target on Aug. 22.
Two shareholder advisory groups have recommended that Allergan investors back the special meeting pushed by Ackman. The activist investor wants to add six Allergan board members and push through the deal with Valeant. Valeant has offered $72 in cash and 0.83 of a Valeant share for each Allergan share.
The pharmaceutical maker and the hedge fund also sued in Delaware Chancery Court Aug. 22 seeking to have Bouchard find they’d complied with Allergan’s bylaws in lining up stockholder support for their request.
Valeant and Ackman say in court filings that their case deserves to be put on the fast track because of Allergan’s repeated efforts to avoid calling the investor meeting to consider ousting the current board. “Shareholders are at risk of being disenfranchised by Allergan’s board,” they said in the filings.
Bouchard will consider Valeant and Ackman’s request to expedite the handling of their suit over the meeting request at a hearing tomorrow in Wilmington.
Laurie Little, a Valeant spokeswoman, didn’t immediately respond to a phone call or an e-mail seeking comment on the request to have the Delaware case expedited. Francis McGill, a spokesman for Pershing Square at Rubenstein Associates Inc., declined to comment.
This month, Allergan sued Valeant and Ackman in federal court in California claiming the drugmaker colluded with the hedge-fund manager to profit from insider trades tied to the takeover bid.
U.S. District Judge David Carter in Santa Ana, California, last week denied Allergan’s request for an expedited hearing for its insider trading suit, clearing the way for Valeant and Ackman to begin an effort to force Allergan officials to schedule the shareholder meeting.
Allergan today filed another request with Carter for expedited handling of its complaint and said it is seeking a court order to prevent Valeant, Pershing Square and Ackman from voting their shares in any special meeting.
The Delaware Case is PS Fund 1 LLC v. Allergan Inc., CA No. 10057-CB, Delaware Chancery Court (Wilmington). The California case is Allergan Inc. v. Valeant Pharmaceuticals International Inc. 8:14-cv-01214, U.S. District Court, Central District of California (Santa Ana).
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