Allergan, Inc. Rejects Offer from Pershing Square, Valeant (AGN, VRX)

On Tuesday morning, Allergan (AGN) announced that its board of directors has turned down the revised bid from Pershing Square Capital and Valeant Pharmaceuticals International (VRX).

According to Allergan’s press release, the board of directors, after consulting with independent financial and legal advisors, deems that the unsolicited offer “substantially undervalues the Company, creates significant risks and uncertainties for the stockholders of Allergan, and is not in the best interests of the Company and its stockholders.”

The revised offer was sent in May 30. The Allergan’s press release went on to say: “The investment community has recognized the revised long-term growth outlook Allergan provided on May 12, 2014 and appropriately raised valuations for a standalone Allergan. We do not believe Valeant's proposal reflects Allergan's growth prospects, nor does it offer sufficient or certain value to warrant discussions between Allergan and Valeant."

This comes after yesterday’s announcement from activist investor Bill Ackman stated that Allergan shareholders backed a takeover bid of $180 per share.

Allergan stock was down $3.94, or 2.38%, in pre-market trading. YTD, the company’s stock is up an impressive 48.85%.

VRX stock was inactive in pre-market trading. YTD, the stock is up 8.25%.