The board of directors of the specialty pharmaceutical company, Depomed, Inc. is recommending to itsi shareholders to reject Horizon Pharma plc’s unsolicited exchange offer to acquire all of the outstanding shares of Depomed for $2.4 billion, which represents an exchange ratio of 0.95 of an ordinary Horizon share for each share of Depomed. Horizon’s made its initial takeover bid for Depomed in July 2015 and latter upped its bid and has taken its takeover bid directly to Depomed shareholders.

“Our board of directors unanimously concluded that Horizon’s unsolicited exchange offer significantly undervalues Depomed, is inadequate and is not in the best interests of Depomed and its shareholders,” said Jim Schoeneck, president and CEO of Depomed and Peter D. Staple, Depomed’s chairman of the board, in a company statement. “We remain very confident in the growth prospects of Nucynta and our strong portfolio of products for pain and neurology related disorders. We continue to believe that Horizon’s exchange offer is opportunistic and would transfer the future value of Depomed to Horizon at a price we believe does not represent the value of Depomed’s assets, business and prospects.”

One point of contention is the actual deal value. In a letter to its shareholders, Depomed contents that the fixed exchange ratio offer had a value of $27.93 which is lower than the $33.00 per share that Horizon says it is offering. Depomed is basing it assessments on the value of Horizon’s shares on the last trading day prior to the commencement of Horizon’s exchange offer on September 8, 2015.

Source: Depomed