MISSISSAUGA, Ontario,
April 21, 2011 /PRNewswire/ --
Valeant Pharmaceuticals International, Inc. (NYSE: VRX) (TSX: VRX)
today filed a revised preliminary consent solicitation statement
and announced its intention to commence on April 22, 2011 the mailing of its definitive
consent solicitation statement to stockholders of record of
Cephalon, Inc. (NASDAQ: CEPH) as of April 8,
2011. Valeant further announced a letter to
stockholders of Cephalon in connection with its consent
solicitation process. The text of that letter appears
below:
To our fellow Cephalon Stockholders,
Valeant recently announced an all-cash offer to acquire Cephalon
for at least $73 per share.
This price represents a 29% premium to Cephalon's 30-day
trading average on the day we announced our offer, and we are
prepared to increase it modestly, if we are permitted to conduct
due diligence and the results of such due diligence demonstrate
greater value than is supported by Cephalon's public filings.
YOU, THE STOCKHOLDERS, SHOULD HAVE THE RIGHT TO
CHOOSE
BETWEEN OUR CASH OFFER OF AT LEAST $73 AND AN UNCERTAIN FUTURE
Unfortunately, Cephalon's Board is unwilling to engage with us
and has rejected our offer in favor of an uncertain standalone
strategy. They are pursuing this strategy even though:
- Cephalon had an average share price of $57 for the month prior to Valeant's offer and
the median Wall Street analyst future price target was then only
$60;
- Cephalon's share price has declined over the past five
years;
- Third parties believe that Cephalon is facing even tougher
times ahead – Recent Wall Street analyst (IBES) median estimates
project a 42% decline in earnings per share from 2011 to 2013;
- 68% of Wall Street analysts gave Cephalon a "Sell" or "Hold"
rating prior to Valeant's offer;
- Cephalon has, in large part, based its future on developing
novel drugs even though it has not successfully developed a major
novel product since 1998 and despite multiple recent pipeline
failures;
- Since Valeant's offer, analysts have come out in support of the
transaction, describing our offer as "an attractive exit"
(Oppenheimer & Co Inc., March 30,
2011), "fair" (Stifel Nicolaus, March
31, 2011), and an "immediate and unmatched premium" (Lazard
Capital Markets, April 5, 2011);
- If we are not permitted to conduct due diligence, Cephalon
stockholders will lose the potential opportunity to have us
modestly increase our offer; and
- If a transaction is not completed, the Cephalon share price
would likely be significantly adversely affected.
CEPHALON'S BOARD REFUSES TO LET YOU CHOOSE
Valeant would still prefer to conduct due diligence and
negotiate a friendly transaction with Cephalon, but the current
Cephalon Board has rejected our attempts. In addition,
Cephalon has structural impediments that prevent the consummation
of our offer, including a "poison pill" that was put in place
without stockholder approval. The Cephalon Board could
eliminate these impediments, but has thus far been unwilling to do
so.
WE EXPECT OUR NOMINEES TO MAXIMIZE VALUE FOR CEPHALON
STOCKHOLDERS
We have begun a consent solicitation process to request that
Cephalon stockholders take action to replace the current Cephalon
Board with the eight highly-qualified and well-respected
professionals we have nominated for election to the Cephalon Board.
We believe our nominees have the right experience, skills and
qualifications to effectively maximize value for, and properly
represent, the interests of Cephalon's stockholders and will be
committed to exploring all of the options to maximize value,
consistent with their fiduciary responsibilities. Those
options will potentially include:
- Providing access to due diligence to, and negotiating with, us
with a view to achieving a higher offer;
- Conducting an efficient auction process while our offer is
open;
- Negotiating a merger agreement with us, which could include a
"go-shop" provision so as to allow Cephalon's Board to determine if
there is a bidder willing to pay a higher price.
We expect the nominees to fully discharge their fiduciary
obligations and, if the nominees elected constitute a majority of
Cephalon's Board, we would be willing to keep our offer open for a
reasonable period of time while the new Cephalon Board explores
Cephalon's options.
COMPLETE AND RETURN THE GOLD CONSENT CARD BEFORE MAY 12
THIS IS YOUR CHANCE TO RECEIVE AT LEAST $73 PER SHARE IN CASH. If you want the
opportunity to accept our offer, we urge you to complete, sign,
date and return the GOLD card that will be included with our
definitive consent solicitation statement. If we do not
receive consents from holders of greater than 50% of the
outstanding shares of common stock by May 12, 2011, we intend
to withdraw our offer and pursue other opportunities.
Sincerely,
J. Michael Pearson
Chairman and Chief Executive Officer
Valeant Pharmaceuticals International, Inc.
About Valeant
Valeant Pharmaceuticals International, Inc. (NYSE: VRX) (TSX:
VRX) is a multinational specialty pharmaceutical company that
develops, manufactures and markets a broad range of pharmaceutical
products primarily in the areas of neurology, dermatology and
branded generics. More information about Valeant can be found at
www.valeant.com.
Forward-looking Statements
Certain statements made in this press release may constitute
forward-looking statements of Valeant, including, but not limited
to, statements regarding our offer to purchase Cephalon, financing
related to the proposed transaction, our consent solicitation
process or our intention to commence a tender offer, our
opportunities and our plans should we acquire Cephalon, the effect
of the proposed transaction on financial results, and certain
financial projections. Forward-looking statements may be
identified by the use of the words "anticipates," "expects,"
"intends," "plans," "should," "could," "would," "may," "will,"
"believes," "estimates," "potential," or "continue" and variations
or similar expressions. These statements are based upon the
current expectations and beliefs of management of Valeant and are
subject to certain risks and uncertainties that could cause actual
results to differ materially from those described in the
forward-looking statements. These risks and uncertainties
include, but are not limited to, risks and uncertainties discussed
in Valeant's most recent annual or quarterly report filed with the
Securities and Exchange Commission ("SEC") and Canadian Securities
Administrators ("CSA") and other risks and uncertainties as
discussed from time to time in Valeant's filings with the SEC and
the CSA, which disclosures are incorporated herein by reference.
Readers are cautioned not to place undue reliance on any of
these forward-looking statements. Valeant undertakes no
obligation to update any of these forward-looking statements to
reflect events or circumstances after the date of this press
release or to reflect actual outcomes except as required by
securities laws. You are advised, however, to consult any
further disclosures we make on related subjects in our filings with
the SEC and the CSA.
Certain Information Concerning Participants In Solicitation;
Additional Information and Where to Find It
This communication may be deemed to be solicitation material in
respect of the proposed removal of directors from, and election of
directors to, the Board of Directors of Cephalon, as well as the
repeal of any changes to Cephalon's Bylaws. On the date hereof,
Valeant filed a revised preliminary consent solicitation statement
with the SEC. THAT DOCUMENT SETS FORTH THE IDENTITY OF THE
PARTICIPANTS IN THE SOLICITATION AND A DESCRIPTION OF THEIR DIRECT
OR INDIRECT INTERESTS, BY SECURITY HOLDINGS, OR OTHERWISE, AND IS
AVAILABLE AT THE WEB SITE MAINTAINED BY THE SEC AT WWW.SEC.GOV. OR
FROM VALEANT'S WEBSITE AT WWW.VALEANT.COM UNDER THE TAB "INVESTOR
RELATIONS" AND THEN UNDER THE HEADING "SEC FILINGS," OR , FOR FREE,
BY DIRECTING A REQUEST TO VALEANT, 7545 IRVINE CENTER DRIVE,
IRVINE, CALIFORNIA, 92618,
ATTENTION: CORPORATE SECRETARY.
This communication does not constitute an offer to buy or
solicitation of an offer to sell any securities. No tender offer
for the shares of Cephalon has commenced at this time.
In connection with any tender offer or consent solicitation,
Valeant will file relevant materials, which may include a tender
offer statement, and a definitive consent solicitation statement
and/or other documents, with the SEC. The definitive consent
solicitation statement filed by Valeant with the SEC will include
the form of gold consent card to be completed and delivered by each
Cephalon stockholder that desires to provide written consent in
connection with the consent solicitation. ALL INVESTORS AND
SECURITY HOLDERS OF CEPHALON ARE URGED TO READ ANY SUCH DOCUMENTS
FILED WITH THE SEC BY VALEANT CAREFULLY AND IN THEIR ENTIRETY,
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT ANY SUCH
TRANSACTION. Investors and security holders will be able to obtain
free copies of documents filed with the SEC by Valeant (when they
become available) in the same manner as set forth above with
respect to the preliminary consent solicitation statement.
Contact Information:
Investors:
Laurie W. Little
Valeant Pharmaceuticals International, Inc.
949-461-6002
laurie.little@valeant.com
Media:
Renee E. Soto
Sard Verbinnen & Co.
212-687-8080
rsoto@sardverb.com
Cassandra Bujarski
Sard Verbinnen & Co.
212-687-8080
cbujarski@sardverb.com
(Logo:
http://photos.prnewswire.com/prnh/20101025/LA87217LOGO)
SOURCE Valeant Pharmaceuticals International, Inc.