Prospects dim for Allergan

Valeant Pharmaceuticals and activist investor William Ackman today won a bid for an expedited trial over the timing of a special meeting of Allergan shareholders, a key to the hostile bid. In the meantime, a leading analyst predicted Allergan is unlikely to fend off the takeover.  

A Delaware judge ordered a three-day trial to begin Oct. 6. Valeant asked for an earlier start date in an effort to force a special meeting by mid-November, about one month earlier than when Allergan has said it will hold a meeting at which Ackman and Valeant hope to elect new board members and force discussion on the deal.

Alex Arfaei of BMO Capital Markets said he believes it is increasingly likely that Valeant will force a deal. He said he was impressed that more than 30% of Allergan shareholders supported a special meeting to consider replacing the board members. He has covered Valeant since May 2013 and is one of 24 analysts who follow the company.