Elan Corporation, plc (NYSE:ELN) poised for $1 billion buyback deal - BIIB
Northern, WI 04/13/2013 (avauncer) –The shareholders of Elan Corporation, plc (NYSE:ELN) (Closed: $12.01, Up by 0.08%) have approved the board’s plan to re-acquire $1 billion worth of stock. This plan will be initiated after its stake in Tysabri, the multiple sclerosis drug, has been sold to Biogen Idec Inc (NASDAQ:BIIB) (Closed: $207.01, Up by 3.37%). The buyback plan was approved at the shareholder meeting that was held two days ago. The move comes on the heels of a dividend proposal as well as plans to buy more drug assets. This decision had been revealed in February and investors will benefit from the proceeds that the company makes from the Biogen deal.
Icing on the cake
The latter has agreed to make a cash payment of $3.25 billion. In addition to this there will be future royalties for Tysabri as well. There are chances of Elan being taken-over by the New York-based investment firm, Royalty Pharma which had indicated that it wants to buy Elan for an amount of $6.5 billion. The deadline for Royalty Pharma to make a formal offer is May 10. There are distinct chances that Royalty may add a little sugar to its offer. A contingency value right that is tied to the sales of Tysabri may be included in the deal said some people familiar with the matter.
In an e-mailed statement the spokesperson for Royalty Pharma, Tom Buchanan said that it is the company’s policy to neither confirm nor deny any kind of rumors. He said that various options are being considered by the company with regards to Elan Corporation.