Elan investors approve share buyback but still must decide on buyout
Calculating future of Elan becomes very complicated.
Being a shareholder in Elan these days is a bit like taking a multiple choice quiz in an advanced MBA class.
They have just resoundingly approved a buyback plan that will pay them $11.25 to $13 a share, Reuters reports, but then there is the $
«If they get to $12, the choice for investors is have you got faith that management can do
The mental gymnastics began last August when the Irish drugmaker’s partners Johnson & Johnson ($JNJ) and Pfizer ($PFE) iced a
Elan dismissed Royalty’s offer as overly «conditional» Reuters points out, and given it until May 10 to come up with something more concrete. Further complicating the calculations of Elan shareholders is the company’s promised «unique cash dividend» that stems from the payments it will receive from Biogen Idec. They call for Elan to get 12% of Tysabri sales the first year, bumped up to 18% after that, unless annual sales exceed $2 billion, in which case it goes up to 25%. Shareholders have been promised 20% of each of those milestones in a dividend.