Valeant Pharmaceuticals has added more cash to its offer to buy Botox maker Allergan in a bid that could now be worth more than $50 billion.
The Canadian drugmaker said Wednesday it will now offer $58.30 and a portion of its stock for each Allergan share. It also promises a contingent value right shareholder payment based on future sales of a potential eye treatment.
Valeant raised the cash portion of its offer by $10 from a previous bid of $48.30 per share. That was part of an offer worth nearly $46 billion that Valeant announced last month. Allergan rejected that bid.
The new bid is worth about $50.4 billion, based on Tuesday's closing price of $129.95 for Valeant Pharmaceuticals International Inc. shares and not counting the potential contingent value right payment. Valeant said that payment could add about $25 per share in additional value to the deal for Allergan shareholders.
Allergan representatives did not immediately return calls from The Associated Press seeking comment on the new bid.
Valeant made its initial bid along with activist investor Bill Ackman. The investor's Pershing Square Capital Management LP holds a 9.7 percent stake in Allergan.
Pershing had agreed to take only stock if the deal went through and would remain as a long-term shareholder of the combined company.
Shortly after the prospective buyers made their offer public, Allergan announced a so-called poison pill plan, a defensive tactic that makes a buyout prohibitively expensive. Allergan also told Valeant that it didn't want to discuss a tie-up.
Earlier this month, Allergan said that Valeant's uncertain long-term growth prospects and business model create a risk for Allergan shareholders, given the stock component of the offer. It also questioned Valeant's cost-cutting plans and whether that would harm the long term viability of its business.
Valeant had said it would make another bid for Allergan. Valeant Chairman and CEO J. Michael Pearson said Wednesday in a letter to his Allergan counterpart, David Pyott, that the two sides should meet.
"It appears based on Allergan's recent public statements that you have a fundamental misunderstanding of our business model and its performance," Pearson wrote.
Shares of Irvine, California-based Allergan climbed 98 cents to $1.66 in premarket trading two hours before Wednesday's market open.