The board of Irish drugmaker Elan unanimously rejected a formal bid from Royalty Pharma on Monday, saying the U.S. investment firm's offer of $11.25 a share grossly undervalues the company.
Royalty launched a cash offer a week ago worth up to $7.3 billion, or $12 per Elan share, improving on an initial proposal to take over the Dublin-based company and the lucrative royalty rights on its main drug.
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That offer depended on the outcome of a $1 billion share buyback conducted by Elan last week. Royalty lowered the bid to $11.25 a share as a result of the pricing of the buyback.
(Reporting by Padraic Halpin; Editing by Louise Heavens)