The heated takeover fight over Allergan Inc., the maker of Botox, continued Tuesday with the Canadian pharmaceutical company Valeant vowing to increase its $46-billion offer this month.
Meanwhile, the Canadian firm's partner in the offer, activist investor Bill Ackman, wants Allergan Inc. shareholders to vote on a resolution that would encourage the Irvine company to meet with Valeant Pharmaceuticals International Inc.
In a filing with the Securities and Exchange Commission, Ackman's Pershing Square Capital Management called for a shareholder meeting to consider a resolution "to clearly demonstrate to the board that Allergan's shareholders favor engagement with Valeant regarding the merger proposal."
Valeant and Ackman's moves came one day after Allergan defiantly rejected their April 22 takeover offer, saying it undervalued the company and threatened its long-term growth.
Valeant said it intends to sweeten its initial bid for the company and would outline details of the new proposal in a May 28 webcast.
In an open letter to Allergan shareholders, Valeant chief Michael Pearson said the company's new offer would be "substantially superior to an Allergan go-it-alone strategy."
"We will discuss why our proposal offers greater short-, intermediate- and long-term shareholder value by managing Allergan's assets under Valeant's operating model," he said.
Allergan responded to Ackman's request for a shareholder vote: "This is obviously a self-serving exercise by Pershing Square to further Valeant's attempt to acquire Allergan.
"This is purportedly being done for the benefit of Allergan shareholders. In fact, this is nothing more than an attempt by co-bidders Pershing Square and Valeant to transfer the value inherent in Allergan to Pershing Square and Valeant at a price that substantially undervalues Allergan."
Valeant has offered to pay $48.30 in cash and 0.83 of a share of its stock for each share of Allergan stock. At Monday's closing price, that would amount to $156.33 for each Allergan share — 41% more than Allergan's Dec. 31 closing price.
Allergan shares rose 1% on Tuesday to $161.28. Valeant's stock was down 0.4% to $129.64.