Biopharmaceutical company Cephalon Inc. said Tuesday its board rejected an unsolicited, $5.7 billion takeover bid from Canada's Valeant Pharmaceuticals Inc.
Cephalon's board concluded the all-cash offer, which translates to $73 a share, is inadequate and not in the best interest of its shareholders.
The company said its board determined that Valeant's offer "significantly undervalues" the company, including its portfolio of products, and said it was an attempt to shift the value away from Cephalon's shareholders.
Cephalon's directors also noted that the offer represents "virtually no premium" to Cephalon's 52-week high stock price of $77.58.
Mississauga, Ontario-based Valeant made its offer public last week after accusing Cephalon of being unwilling to engage in discussions over the proposed offer in a timely manner.
It also said it would press to install a slate of hand-picked directors to Cephalon's board this week.
Cephalon shares slipped 92 cents to $76.45 in aftermarket trading following the rejection. The stock ended the regular session up 45 cents at $77.37. Valeant shares slid 46 cents to $53.50 in aftermarket trading after adding added 98 cents to $53.96 in the regular session.