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Allergan requests preliminary injunction against Valeant, Pershing Square
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Allergan has requested that the U.S. District Court for the Central District of California set an expedited schedule for discovery, as well as a motion for a preliminary injunction against Valeant Pharmaceuticals, Pershing Square Capital Management and its principal, William A. Ackman, for federal securities law violations.
As part of the preliminary injunction, Allergan will seek an order prohibiting Valeant, Pershing Square and Ackman from exercising rights and benefits associated with Allergan shares that have been acquired unlawfully, according to a company press release.
The company also announced it will hold a special meeting of stockholders on Dec. 18. The company set Oct. 27 as the record date for stockholders entitled to vote at the special meeting.
As part of the special meeting, Allergan stockholders would be asked to replace a majority of the company’s existing directors and address other matters related to Valeant’s unsolicited exchange offer.
The schedule Allergan proposed to the U.S. District Court would require completion of expedited discovery by October 2014, setting a hearing for the company’s anticipated preliminary injunction motion in advance of the special meeting. If the injunction is granted, Valeant, Pershing Square and Ackman’s shares would not be counted toward a special meeting request, according to the release.
In April, Valeant proposed to acquire all outstanding Allergan shares for a combination of 0.83 shares of Valeant common stock and $48.30 in cash per share. Allergan rejected the merger offer and two subsequent merger proposals.
In June, Valeant made an unsolicited exchange offer to acquire all outstanding common shares of Allergan for 0.83 shares of Valeant common stock and $72 in cash, or an amount of cash or a number of Valeant common shares subject to proration.
On Aug. 1, Allergan filed a lawsuit in the U.S. District Court against Valeant, Pershing Square and Ackman, citing violations to federal securities laws prohibiting insider trading, engagement in fraudulent practices and failure to disclose legally required information.