ISTA Pharma Surges on Increased Bid from Valeant

Shares of ISTA Pharmaceuticals Inc. (NASDAQ: ISTA) are surging over 11% in morning trade after the company received a higher bid from Valeant Pharmaceuticals International, Inc. (NYSE: VRX). Valeant today announced that it has increased from $6.50 to $7.50 per share in cash the proposed price of its previously announced offer to acquire ISTA Pharmaceuticals Inc.

ISTA shares currently trade at $8.10 well above the $7.50 offer as Valeant communicated to ISTA that Valeant believed that it could fetch a price of up to $8.50 per share, assuming that ISTA provides it selected confirmatory due diligence related to the company that is consistent with what Valeant expects to see.

After repeated attempts to enter into acquisition negotiations with ISTA, in December 2011 Valeant announced that it had made a proposal to the Board of Directors of ISTA to acquire the company for $6.50 per share in cash. At that time, Valeant had made it clear that its proposal would remain in effect only until January 31, 2012. Valeant again emphasized its January 31 deadline.

Valeant expressed its disappointment that the Board of Directors and management of ISTA have not been willing to meaningfully engage with Valeant on a timely basis to obtain the benefits of its proposal. “We do not understand why ISTA would not have already pursued discussions with us and provided due diligence access,” stated Mr. Pearson Chairman and CEO of Valeant. “Our proposal represents an attractive premium to ISTA’s trading performance, and we believe it offers a compelling opportunity for shareholders in light of ISTA’s ongoing operational challenges.”

Valeant has called on the Board of Directors of ISTA to engage in meaningful discussions with Valeant and to provide it with access to selected due diligence in order to enter into a transaction no later than January 31, 2012.

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Post Written By: Ed Liston Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.