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Valeant Pharmaceuticals International Inc. said on Friday it has submitted an unsolicited $314-million bid to acquire smaller U.S. rival ISTA Pharmaceuticals Inc., which specializes in producing ophthalmic pharmaceutical products.
Acquisition-hungry Valeant said it has submitted an all-cash bid worth $6.50 a share to ISTA, which has been rejected by the company's board of directors.
"The proposed $6.50 per share price represents a meaningful premium to ISTA's recent trading performance, and we believe it represents a compelling opportunity for ISTA's shareholders in light of the continuing challenges facing ISTA," said Valeant's CEO Michael Pearson, in a statement.
"We would be willing to consider improving our offer price if we were allowed to conduct due diligence and found additional value," he added.
Irvine, California-based ISTA's shares have plummeted over the last seven months, as sales of one of its key eye treatments for inflammation and pain have been hurt by the launch of a generic version by rival Mylan Inc.
ISTA's shares, which touched $11.39 in April this year, have since fallen 66 percent. The company's shares closed at $3.89 a share on Thursday on the New York Stock Exchange.
The company's stock however, jumped to $6.20 in pre-market trading on Friday, following the announcement of the Valeant bid.
Last month, Valeant said it had agreed to buy Australia's iNova Pharmaceuticals from private equity firms Archer Capital and Ironbridge for $625 million AUD. It also recently completed its $88-million CDN acquisition of Canadian cold and flu medicine maker Afexa Life Sciences.