Royalty granted injunction over changes to Elan bidThursday 13 June 2013 17.07
Royalty Pharma has been granted a High Court injunction which could save its hostile bid for Elan even if some votes go against it at a meeting of the Irish drug company's shareholders next week.
United States-based Royalty had made its offer for Elan contingent on the Irish company's shareholders rejecting a series of four resolutions at the meeting to be held on Monday.
However, citing a review it had undertaken of voters, Royalty said Elan shareholders were set to back one of four resolutions being voted on ahead of a meeting on Monday.
This result would make its bid for the Dublin-based company null and void.
The company had sought to ease its requirement for all four resolutions to be rejected but was stopped from making the change last week by the country's Takeover Panel.
Following this Royalty sought an injunction, which has now been granted by Justice Peter Kelly.
A hearing has been scheduled for Wednesday to decide if the investment firm will be allowed to challenge the panel's decision.
If Royalty is forced to withdraw its bid, it would be prevented from making another unsolicited offer for 12 months under Irish takeover rules.
Elan shareholders, the majority of whom are based in the US, are due to vote next week on a number of resolutions put forward by the company in an attempt to defend against Royalty's bid.
The US investment firm claimed that, after 70% of Elan's US shareholders had lodged their response ahead of a deadline later today, it expected the vote on a €200m share buyback would be approved.
In addition to seeking permission to change the terms of its bid to allow for this, the company said it was also talking with Elan shareholders to see if any were willing to change their vote so that it might be rejected.
Its latest bid, which has been rejected by the Elan board, offers $13 in cash per share - compared with a previous $12.50.
The latest bid added a clause known as a contingent value right (CVR) that could add a further $2.50 per share if blockbuster MS drug Tysabri hits certain sales milestones.