On February 25, 2013, after Royalty Pharma released the Proposal Announcement, Elan stated publicly that it would consider any credible proposal, implying that Royalty Pharma's Proposal was not credible.
On March 4, 2013, Elan announced a plan to distribute 20 percent of the Tysabri Royalty to shareholders through dividends. Deutsche Bank and RBC Capital Markets have calculated that this would imply a dividend yield of only 1-2 percent in the short term, and this announcement provides no further clarity about Elan's plans for the remaining 80 percent of the Tysabri Royalty. The Elan CEO made a number of remarks in an interview on that day that rejected entertaining any discussions with Royalty Pharma, stating that:
Accordingly, Royalty Pharma believes that Elan is still not focused on maximising shareholder value, and that Elan Shareholders should treat Elan's recent change of heart regarding returning cash to Elan Shareholders with scepticism.
The reaction of analysts to the Tysabri Transaction
Following the announcement of the Tysabri Transaction, four analysts (AlphaValue, Deutsche Bank, RBC Capital Markets, and UBS) cut their ratings on the Elan Stock and nine analysts (Al
|SOURCE RP Management, LLC|
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