Horizon takes hostile Depomed bid directly to shareholders

Horizon Pharma is pushing ahead with its hostile, $2.4-billion bid to buy Depomed by starting an offer to exchange a portion of its stock for shares of the rival drugmaker.

Horizon Pharma, whose U.S. operations are based in Deerfield, makes the rheumatoid arthritis drug Duexis. Depomed has a portfolio that includes the migraine drug Cambia and the painkiller Nucynta ER.

Horizon said Tuesday that it will trade 0.95 of its shares for each Depomed share in an offer scheduled to expire in November.

The offer is worth $33 per share and represents a 60 percent premium to the $20.64 closing price of Depomed stock in early July, before Horizon went public with its acquisition proposal.

Depomed said its board will carefully review the exchange offer and then detail its position to shareholders in a regulatory filing.

The Newark, California-based drugmaker has already rejected the $33-per-share bid, saying it does not reflect the value Depomed would bring to a combined company. That bid represented an increase from a previous offer worth about $2.1 billion, or $29.95 per share.

Depomed’s board also has adopted a “poison pill” measure that aims to thwart a hostile takeover attempt by essentially making it too expensive.

Dublin-based Horizon Pharma Plc., which owns a 3.7 percent stake in Depomed, is also asking that drugmaker’s stock owners to call special meetings to vote on replacing its board of directors.

This comes more than a month after Horizon asked Depomed to set a shareholder vote on its bid and filed a lawsuit challenging the poison pill provision.

U.S.-traded shares of Horizon rose 43 cents to $29.83, as broader indexes also jumped nearly 2 percent shortly after markets opened Tuesday. Depomed climbed 21 cents to $26.87. That stock price has soared more than 65 percent so far this year.