VRX - Valeant Pharmaceuticals International Inc.

[peter1234]

http://nypost.com/2014/08/22/ackman-gets-needed-allergan-votes/

 

Activist Bill Ackman has the votes to call a special shareholders meeting of Allergan shareholders, and a federal trial isn’t going to stop him, a California federal judge said Thursday.

 

Judge David Carter mentioned the votes in a order denying the botox maker’s motion to expedite its case against Ackman, his Pershing Square hedge fund and Valeant, a Canadian drug company. [...]

 

Allergan has to call a special shareholders’ meeting within 120 days after at least 25 percent of shareholders request the meeting in a Delaware court.

 

Ackman is ready to go, according to [judge] Carter. “They have collected the required number of forms and intend to request a special meeting,” the judge noted.

 

 

$VRX has support of more than 30% of Allergan shares, will call a special mtg, @davidfaber reports

 

Assuming all this is true, can someone explain what other options does the AGN Board and Management now have?

1. Wait for 4 months to call the meeting, collect paychecks until then, get thrown out and watch the company get bought

2. Start negotiating with VRX for their severance package in exchange for an earlier deal closing

 

Wait 4 months, create more trouble, negotiate severance packages with themselves.

;D

[Liberty]

Here's the CNBC clip about the votes:

 

http://video.cnbc.com/gallery/?video=3000304637

 

"expecting the request for the meeting with over 30% of the votes to be done today, by close of business"

 

Reuters:

 

http://finance.yahoo.com/news/valeant-ackman-submit-allergan-special-140129936.html

 

Valeant Pharmaceuticals International Inc and Pershing Square Capital Management will submit a request on Friday to Allergan Inc for a special shareholders meeting, sources told CNBC television.

[merkhet]

I watch this the way I watch HLF -- out of morbid curiosity. The Allergan managements' actions thus far have been nothing short of shameful.

[Liberty]

I watch this the way I watch HLF -- out of morbid curiosity. The Allergan managements' actions thus far have been nothing short of shameful.

 

The scary thing is, if they succeed, their tactics/bylaws will be copied by many other companies with entrenched managements who want to make it as hard as possible for shareholders to decide to sell the company.

 

http://dealbook.nytimes.com/2014/08/22/valeant-and-pershing-square-said-to-have-votes-for-special-meeting-of-botox-maker-allergan/

 

Path forward:

 

[Liberty]

Looks like 31% of votes are in for now, with more likely coming in if they need them, since AGN could try to throw some votes out to claim they don't have the 25% needed; disenfranchising shareholders is their specialty. Seems like a pretty good number considering how hard the process is (you gotta see the Allergan bylaws and how crazy hard they made it -- very short time window for meeting, you have to provide two years of trading info, etc).

 

http://www.bloomberg.com/news/2014-08-22/valeant-says-enough-allergan-investors-demand-meeting.html

 

“The degree of support received is remarkable in light of the extraordinarily burdensome requirements that shareholders have had to meet to deliver their consents,” Ackman said in a statement. “No special meeting has ever been called with shareholders being required to comply with such onerous procedural and informational requirements.”

 

Two shareholder advisory groups have recommended that Allergan investors back the special meeting pushed by Ackman

[loganc]

Looks like 31% of votes are in for now, with more likely coming in if they need them, since AGN could try to throw some votes out to claim they don't have the 25% needed; disenfranchising shareholders is their specialty. Seems like a pretty good number considering how hard the process is (you gotta see the Allergan bylaws and how crazy hard they made it -- very short time window for meeting, you have to provide two years of trading info, etc).

 

http://www.bloomberg.com/news/2014-08-22/valeant-says-enough-allergan-investors-demand-meeting.html

 

“The degree of support received is remarkable in light of the extraordinarily burdensome requirements that shareholders have had to meet to deliver their consents,” Ackman said in a statement. “No special meeting has ever been called with shareholders being required to comply with such onerous procedural and informational requirements.”

 

Two shareholder advisory groups have recommended that Allergan investors back the special meeting pushed by Ackman

 

I am about to finish up reading "Confidence Game" - I am late to the party on this one.  My conclusion is that I wish AGN mgmt the best of luck in fighting off Ackman.

[giofranchi]

I am about to finish up reading "Confidence Game" - I am late to the party on this one.  My conclusion is that I wish AGN mgmt the best of luck in fighting off Ackman.

 

I have read the book some time ago, and I agree with you 100%. ;)

 

Gio

[giofranchi]

I watch this the way I watch HLF -- out of morbid curiosity. The Allergan managements' actions thus far have been nothing short of shameful.

 

I couldn’t agree with you more!

 

And we see almost the same dynamic at play between Biglari and Cracker Barrel.

 

People really do not see the difference between entrepreneurs and managers?!… This keeps baffling me…

 

Gio

 

[loganc]

“Stockholders were asked to evaluate if they wanted the opportunity to vote on the offer at a later date; not to evaluate the merits of the offer itself,” Allergan said in a statement. “In fact, many stockholders have explicitly conveyed their view that the requests are not an endorsement of Valeant’s offer.”

 

LOL.  This is insane.

[wbr]

I am about to finish up reading "Confidence Game" - I am late to the party on this one.  My conclusion is that I wish AGN mgmt the best of luck in fighting off Ackman.

 

I read it a couple of months ago to research Ackman and I was very impressed. He seems to do more work than anybody. Could he make VRX his biggest position ever (if AGN deal closes) and be deceived by "accounting games" and "the illusion of cash earnings"? I doubt it.

[muscleman]

I am about to finish up reading "Confidence Game" - I am late to the party on this one.  My conclusion is that I wish AGN mgmt the best of luck in fighting off Ackman.

 

I read it a couple of months ago to research Ackman and I was very impressed. He seems to do more work than anybody. Could he make VRX his biggest position ever (if AGN deal closes) and be deceived by "accounting games" and "the illusion of cash earnings"? I doubt it.

 

I wonder why didn't he buy any VRX right now?

[Liberty]

I wonder why didn't he buy any VRX right now?

 

Ackman? He can't, at least until the AGN proposal ends one way or another.

[fareastwarriors]

Valeant Pushes Ahead in Allergan Fight

 

It Asks Judge to Speed Vote That Could Oust Directors

 

 

 

http://online.wsj.com/articles/valeant-pushes-ahead-in-fight-for-allergan-1408924423

[Liberty]

Allergan's great, shareholder disenfranchising bylaws at work:

 

In a statement, Pershing said that, over the next few weeks, it expects to deliver additional requests from shareholders who are in the process of completing the required documentation. Specifically, any participating investor that sells shares prior to the meeting can no longer have those shares counted towards the minimum 25% Pershing needs to call the meeting.

 

Nevertheless, a person familiar with the situation noted that the investors agreeing to participate are long-term investors that Pershing believes will be there at the time of the meeting. Pershing's Ackman has received the backing of 35 large investors and is seeking additional support from smaller investors in an effort to make sure that he still has more than 25% at the time of the meeting.

 

"It's a miracle Pershing got investors to participate," said an attorney familiar with the situation.

 

The attorney noted that in most cases investors seeking to consent to participate in a vote to hold a special shareholder meeting must fill out a one page form. At Allergan, he noted, each institution must fill out a multiple page questionnaire and provide numerous verification letters. Investors must provide a spreadsheet with information about every trade the fund has made in Allergan over the previous two years, a prospect the dissident has argued is complicated and time consuming and raises proprietary trading issues.

 

"Many funds consider their trading info proprietary and don't want to disclose it," the attorney said.

 

In one case, he added, a shareholder put together a package that was 174 pages long with 85 signatures in it. "It probably took tens of thousands of dollars of legal work and lots of internal time," he said.

 

http://www.thestreet.com/story/12855479/1/pershing-square-delivers-votes-for-allergan-special-meeting-to-push-valeant-deal.html

[Guest wellmont]

Allergan's great, shareholder disenfranchising bylaws at work:

 

In a statement, Pershing said that, over the next few weeks, it expects to deliver additional requests from shareholders who are in the process of completing the required documentation. Specifically, any participating investor that sells shares prior to the meeting can no longer have those shares counted towards the minimum 25% Pershing needs to call the meeting.

 

Nevertheless, a person familiar with the situation noted that the investors agreeing to participate are long-term investors that Pershing believes will be there at the time of the meeting. Pershing's Ackman has received the backing of 35 large investors and is seeking additional support from smaller investors in an effort to make sure that he still has more than 25% at the time of the meeting.

 

"It's a miracle Pershing got investors to participate," said an attorney familiar with the situation.

 

The attorney noted that in most cases investors seeking to consent to participate in a vote to hold a special shareholder meeting must fill out a one page form. At Allergan, he noted, each institution must fill out a multiple page questionnaire and provide numerous verification letters. Investors must provide a spreadsheet with information about every trade the fund has made in Allergan over the previous two years, a prospect the dissident has argued is complicated and time consuming and raises proprietary trading issues.

 

"Many funds consider their trading info proprietary and don't want to disclose it," the attorney said.

 

In one case, he added, a shareholder put together a package that was 174 pages long with 85 signatures in it. "It probably took tens of thousands of dollars of legal work and lots of internal time," he said.

 

http://www.thestreet.com/story/12855479/1/pershing-square-delivers-votes-for-allergan-special-meeting-to-push-valeant-deal.html

 

the reason they got so much participation is that there is huge money involved here and massive upside if they can remove the "impediment" to AGN value creation----the BOD and CEO. The big participation is a testament to how awful his stewardship has been. Even if they don't merge with VRX, getting rid of these guys will payoff in the long run with better governance and shareholder friendly decisions.

[Liberty]

WSJ reporter tweeting that meeting will be set for December 18:

 

"Allergan sets shareholder mtg for Dec 18. Valeant & Pershing Sq hoping for an early Christmas present (an expensive one, at $53b) $AGN"

 

 

Update:

 

"Allergan (NYSE: AGN) set a special meeting on December 18, according to Bloomberg, citing court documents. The meeting relates to proposals by Valeant Pharma (NYSE: VRX) and Pershing Square."

 

http://www.streetinsider.com/Hedge+Funds/Allergan+(AGN)+Special+Meeting+Set+for+Dec.+18+-+Bloomberg/9783902.html

 

http://nypost.com/2014/08/26/allergan-shareholders-to-meet-in-december-amid-lawsuit/

 

Allergan shareholders will get their special meeting that could facilitate a takeover by Canadian drug company Valeant — but not until Dec. 18.

The botox maker said Tuesday it had set that date for the meeting in a filing response to a Delaware Chancery Court lawsuit brought by its biggest shareholder, Bill Ackman’s Pershing Square hedge fund, and Valeant.

[Guest wellmont]

typically shareholder friendly. the last day they could have legally held the meeting on a business day was dec 19th.  ::)

[Liberty]

Looks like there's a chance the special meeting will be before December 18:

 

http://online.wsj.com/articles/judge-fast-tracks-valeant-pershing-suit-versus-allergan-1409156501

 

A Delaware judge has fast-tracked a lawsuit from Valeant Pharmaceuticals International Inc. and hedge-fund manager William Ackman against Allergan Inc., handing the pair a small victory in their hostile bid for the drug maker. [...] Mr. Ackman's Pershing Square Capital Management LP and Valeant sued Allergan last week to force the company to quickly schedule a special meeting, at which the pair hopes to replace a majority of Allergan's board.

 

Allergan said Tuesday it would schedule the meeting for Dec. 18. Pershing Square and Valeant are now pushing for it to be held in mid-November, according to some of the people.

[Liberty]

Sequoia fund meeting transcript, with some studf about Valeant (many parts about it, do a search for 'valeant' to find them, but it's all interesting. Some stuff about IBM, GOOG, PCP, etc):

 

http://www.sequoiafund.com/Reports/Transcript14.pdf

 

Found via Wellmont on twitter. Go follow him (@well_mont)!

[Picasso]

Sequoia fund meeting transcript, with some studf about Valeant (many parts about it, do a search for 'valeant' to find them, but it's all interesting. Some stuff about IBM, GOOG, PCP, etc):

 

http://www.sequoiafund.com/Reports/Transcript14.pdf

 

Found via Wellmont on twitter. Go follow him (@well_mont)!

 

Great stuff, thank you.

[giofranchi]

Sequoia fund meeting transcript, with some studf about Valeant

 

It would be a huge mistake to underestimate Mike Person. Do not bet against him.

--Bob Goldfarb

 

Well, exactly! ;)

 

Gio

[wbr]

Mike Pearson's New Prescription for the Pharmaceuticals Industry

 

http://www.institutionalinvestor.com/Article/3376350/Mike-Pearsons-New-Prescription-for-the-Pharmaceuticals-Industry.html?ArticleId=3376350#.VAcWxPnV9km

[Liberty]

Mike Pearson's New Prescription for the Pharmaceuticals Industry

 

http://www.institutionalinvestor.com/Article/3376350/Mike-Pearsons-New-Prescription-for-the-Pharmaceuticals-Industry.html?ArticleId=3376350#.VAcWxPnV9km

 

I was just about to post that  :)

[original mungerville]

Sequoia fund meeting transcript, with some studf about Valeant

 

It would be a huge mistake to underestimate Mike Person. Do not bet against him.

--Bob Goldfarb

 

Well, exactly! ;)

 

Gio

 

 

Gio, do you have an investment here at this point? I made one, but its not huge. I have been wondering whether my position is large enough. The 18 billion in debt doesn't sit well with me. If it wasn't for that, I'd have 15% of my portfolio in this one. I really really like Pearson.

 

[plato1976]

same here - the debt frightened me a little bit

 

Sequoia fund meeting transcript, with some studf about Valeant

 

It would be a huge mistake to underestimate Mike Person. Do not bet against him.

--Bob Goldfarb

 

Well, exactly! ;)

 

Gio

 

 

Gio, do you have an investment here at this point? I made one, but its not huge. I have been wondering whether my position is large enough. The 18 billion in debt doesn't sit well with me. If it wasn't for that, I'd have 15% of my portfolio in this one. I really really like Pearson.