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Pershing Square Has A Few Things To Say To Allergan Shareholders

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Nobody asked Bill Ackman if he was OK with Allergan telling Valeant to go shove it because they’re a terrible company whose only business is to buy other businesses. He’d like to know if they asked anybody else.

In a regulatory filing on Monday, Ackman's hedge fund Pershing Square Capital Management said that it has requested a complete list of holders of record in Allergan to be able to "communicate with fellow stockholders of the company."

Ackman wrote to Allergan Associate General Counsel Matthew Maletta and asked that the company turn over the list within five business days.

On Monday, Allergan formally rejected the Valeant offer, saying the proposal “substantially undervalues Allergan, creates significant risks and uncertainties for the stockholders of Allergan, and is not in the best interests of the company and its stockholders….”

“We are disappointed that Allergan has rejected our value-creating offer without engaging in any substantive discussions with Valeant or Allergan’s largest stockholder, Pershing Square, and we remain committed to pursuing this transaction,” said Valeant’s head of investor relations, Laurie Little….

Mr. Pyott also called into question the continued viability of Valeant, which is based in Quebec and has grown rapidly through acquisitions.

“Their strategy is absolutely unsustainable,” he said. “This company has to keep acquiring, otherwise they will peter out. It’s a roll-up strategy.”

Moreover, Mr. Pyott said Valeant’s strategy was based more on raising prices than on innovation.

But the news isn’t all bad: Bill’s still got most of that 38% return to console himself.

Shareholders responded by sending Allergan stock down slightly, possibly reflecting the belief that given its adamant defense, a deal is less likely to get done.

Ackman asks for Allergan’s stockholder list [Reuters]
In Rejecting Merger Bid, Allergan Focuses on Strategy [DealBook]
Ackman Gains 38% on Valeant Deal To Buy Allergan [WSJ]