Mylan Offers To Buy Perrigo For $28.9 Bln.

(RTTNews) - Mylan N.V. (MYL) on Wednesday said it has offered to buy Dublin-based Perrigo Co Plc (PRGO) for $205 per share in cash and stock, or $28.9 billion, as the generic drug maker seeks to create a diversified pharmaceutical behemoth.

The offer represents a premium of more than 25 percent premium to Perrigo's closing price on April 3, the last trading date prior to Mylan's proposal.

Following the announcement, Perrigo shares soared 26 percent in morning trade, and Mylan stock jumped 10 percent.

In a communique to Perrigo Chairman and CEO Joseph Papa, Mylan said a merger would result in a strong operating platform, with potential for significant operating synergies and long-term growth.

"This proposal is the culmination of a number of prior discussions between Mylan and Perrigo about the compelling strategic and financial logic of this combination," said Mylan Executive Chairman Robert Coury in a statement.

The two companies had 2014 pro forma sales totaling about $15.3 billion.

Mylan, based in Potters Bar, England, said it has conducted a thorough review of Perrigo's business, and seeks an opportunity to complete customary confirmatory due diligence.

In the event of a merger, Mylan said Robert Coury would continue as executive chairman and Heather Bresch as CEO, while key executives from Perrigo too would have a role in the combination's management.

Mylan is one of the largest generics and specialty drug companies, with about 1,400 different products. Last year, Mylan agreed to buy the non-U.S. operations of Abbott Laboratories for $5.3 billion as a strategy to shift its tax base to the Netherlands.

In a similar effort, Perrigo in 2013 had acquired Elan Corp in order to be domiciled in Dublin.

Mylan said it has retained Goldman Sachs as financial advisors and Cravath, Swaine & Moore as legal advisors for the proposed combination.

The pharmaceuticals industry has seen a slew of mergers. In March, bigger rival Actavis plc (ACT) completed the acquisition of Allergan Inc (AGN) in a cash and equity deal valued at about $70.5 billion. The combination creates one of the world's top 10 pharmaceutical companies by sales revenue, with combined annual pro forma revenues of more than $23 billion anticipated in 2015.

MYL is trading at $65.72, up $6.15 or 10.32%, on a volume of 15.7 million shares on the Nasdaq.

PRGO is trading at $207.13, up $42.42 or 25.75%, on a volume of 2.2 million shares on the NYSE.