Elan to Start Share Buyback Next Week
Drugmaker Elan is to bring forward a planned $1 billion share buyback to next week, the Irish company said in a statement, a move that could undermine a takeover offer by U.S. investment firm Royalty Pharma.
Elan, which is fighting a $6.6 billion approach from Royalty Pharma worth $11 per Elan share, said it would start a share buyback with a price range of $11.25 to $13.00 on Monday, earlier than previously planned.
Royalty Pharma said in an statement last month that their approach might not be able to proceed in the event of a share buyback.
Royalty Pharma made its approach after Elan announced last month a $3.2 billion plan to sell its 50% stake in multiple sclerosis drug Tysabri to its U.S. partner Biogen .
Elan rejected Royalty Pharma and on Monday sweetened its offer to shareholders, saying that it would give them 20% of future royalties from Tysabri.
The $1 billion share buyback had originally been planned for after the drug sale. Elan on Friday said it expected the Tysabri sale to be completed within weeks, as it had secured approval from antitrust authorities in the U.S. and Spain.
Royalty Pharma said on Wednesday that it was meeting with Elan shareholders and was willing to move quickly to complete the deal.
A spokesman for Royalty Pharma did not immediately respond to a request for comment.
