Swedish Drug Maker Meda Rejects Offer To Merge With Mylan, Terminates All Talks

(RTTNews) - Swedish drug maker Meda AB (MDABF, MDABY) on Friday rejected an indicative proposal from Generic drugmaker Mylan, Inc. (MYL) to combine the two businesses, according to a statement released by Meda's board of directors. Meda also added that it has terminated all discussions with Mylan related to a deal.

"The Board has convened and has decided to reject the proposal. All continued discussions between Meda and Mylan have been terminated without further actions," the Meda board said in the release.

The Meda board confirmed that it has been contacted by Mylan regarding an indicative proposal to combine the two businesses.

Reports on Thursday revealed that Mylan was looking to float an offer to acquire European rival Meda in a deal that will create a $23 billion specialty pharmaceutical company.

As of Thursday, Mylan had a market capitalization of about $18.5 billion, while Meda had a market capitalization of about 29.5 billion Swedish krona or $4.5 billion.

Mylan has been on the lookout for a substantial deal in 2014 as confirmed by its CEO Heather Bresch in late-February while reporting financial results for fiscal 2013.

Mylan CFO John Sheehan also said, "As we move into 2014, we expect that our financial flexibility will provide further opportunities to expand our business in strategic areas and create additional value for our shareholders. We look forward to continuing to leverage our unique global operating and commercial platform and identifying additional opportunities for growth."

Canonsburg, Pennsylvania-based Mylan has reportedly been working with advisers on the possible deal.

Generic drug makers like Mylan are also looking at overseas acquisition amid heightened competition, pricing pressures and fewer brand-name blockbuster drugs losing U.S. patent protection.

Mylan completed the $1.75 billion acquisition of the Agila injectables businesses from India-based Strides Arcolab Ltd. in December 2013. The deal expanded and strengthened Mylan's existing injectables platform and portfolio, and provided Mylan entry into exciting, new geographic markets.

MYL closed Thursday's regular trading session at $52.56, down $2.70 or 5.42% on a volume of 4.08 million shares.