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Sunday, November 20, 2005 7:36:21 PM
Medicis Board Unanimously Rejects Mentor Proposal
[As if things weren’t complicated enough already in these machinations over the fate of these breast-implant and facial aesthetics businesses, now MNT has stepped into the fray. To recap: MRX, which sells the premier dermal filler, Restylane, offered to buy IMDC, which sells breast implants and some second-rate dermal fillers and is developing a botulinum-toxin competitor to Botox that was licensed from Europe. AGN, which makes Botox, then offered to buy IMDC on better terms than MRX’s offer and even promised to sell IMDC’s botulinum toxin to assuage anti-trust concerns (although I have my doubts about the sincerity of this offer). Now, MNT, who competes with IMDC in breast implants and dermal fillers and is developing yet another botulinum toxin that may turn out to be the best in the business, has offered to buy MRX, based on the assumption that MRX will no longer be buying IMDC. (MNT’s and IMDC’s businesses under the same corporate umbrella would be an obvious anti-trust problem in breast implants). However, MRX says no dice to MNT, which leaves MRX free to raise their bid for IMDC to exceed AGN’s bid or to simply remain as they are. The text of MNT’s letter to MRX is appended to the end of this PR.
Is all this completely clear?
]
http://biz.yahoo.com/bw/051120/20051120005024.html?.v=1
>>
Sunday November 20, 6:27 pm ET
SCOTTSDALE, Ariz.--(BUSINESS WIRE)--Nov. 20, 2005--The Board of Directors of Medicis (NYSE: MRX ) has unanimously rejected an unsolicited proposal by Mentor Corporation (NYSE: MNT ) to acquire Medicis by exchanging 0.62 of a share of Mentor for each share of Medicis. The Medicis Board confirmed that Medicis remains committed to completing its proposed merger with Inamed Corporation (NASDAQ: IMDC ).
The Board stated, "We are focused on maximizing stockholder value now and in the future. The proposal by Mentor is inappropriate in light of the recent trading history of the two companies and the pending stockholder votes on the Inamed merger. We continue to unanimously recommend that our stockholders vote in favor of our proposed merger with Inamed as we believe that a combination with Inamed will maximize stockholder value."
A more complete description of the proposed merger with Inamed is set forth in the registration statement on Form S-4, as filed by Medicis on November 16, 2005, with the U.S. Securities and Exchange Commission. Medicis and Inamed have each scheduled stockholder meetings on December 19, 2005 for their stockholders to consider this merger.
…
TEXT OF PROPOSAL LETTER
November 18, 2005
Mr. Jonah Shacknai
Chairman of the Board
and Chief Executive Officer
Medicis Pharmaceutical Corporation
8125 North Hayden Road
Scottsdale, Arizona 85258
Dear Jonah:
We are pleased to submit for your consideration a proposal for the combination of Medicis Pharmaceutical Corporation and Mentor Corporation. We believe that this combination offers your stockholders substantially greater value than your pending transaction with Inamed and will create a global leader in the aesthetics market that would benefit all Medicis and Mentor constituencies. We believe this offer constitutes a superior proposal as contemplated by your merger agreement with Inamed Corporation.
Mentor is proposing a merger of Medicis and Mentor in a transaction that would provide the Medicis stockholders with an equity ownership interest of approximately 44% in the combined company on a fully diluted basis. Specifically, we are proposing a stock-for-stock transaction in which Medicis stockholders will receive 0.62 shares of Mentor common stock per Medicis share. Based on closing prices on November 18, 2005, this represents total equity consideration of approximately $2.2 billion and offers Medicis stockholders a 25% premium for their shares.
The strategic rationale for the Mentor/Medicis combination is compelling. Aesthetic medicine is a dynamic marketplace undergoing transformative changes. The market has expanded to include a large, growing number of non-surgically oriented procedures, primarily in the facial rejuvenation arena. At the same time, there has been an influx of new providers and distribution outlets emerging in the market, offering patients expanded access to a variety of procedures. Mentor's leadership in the plastic surgery market is based on the quality and breadth of its product offerings and the reputation we have established based on our dedication to customer service and value added support programs. Similarly, Medicis' leadership in the dermatology and cosmetic dermatology markets is based on the breadth of its product offerings and reputation for market leading sales focus and customer service. The combined product portfolios of the two organizations establish a strong basis for sustainable competitive advantage in both the surgical and non-surgical cosmetic procedures market segments.
The two companies are category leaders in their respective market segments with strongly positioned brands. The resulting organization will have comprehensive distribution capabilities across a broad array of outlets including private practice physician offices and clinics, hospitals, surgery centers, and medi-spas. Given the complementary fit, we would expect that the existing sales organizations of each company would continue to serve their respective customers with substantial opportunities to leverage each other's expertise for the benefit of the combined company and its customers.
The combination of Medicis and Mentor would create a global leader in the rapidly expanding aesthetics market, with combined annual revenues in the 12 months ended September 30, 2005 of nearly $900 million, direct selling operations in 12 countries with independent distributor relationships in over 60 countries and over 2,300 employees. The combined company would have a scalable platform into which it could integrate other products and technologies and rapidly introduce those products to the combined customer base.
Jonah, we at Mentor have great respect for you and your leadership capabilities. We envision a merger in which you and your management team will play an integral role in defining the leadership and strategy of the combined company. We look forward to discussing with you a governance structure that creates the greatest value for our new company, with a combination of directors from both companies continuing to serve after the closing of our merger.
A Mentor/Medicis merger is an exciting opportunity for both our companies. Mentor is prepared to execute an appropriate confidentiality agreement and, together with our financial advisors, Goldman, Sachs & Co. and Citigroup Global Markets Inc., and our legal advisors, Wilson Sonsini Goodrich & Rosati, P.C., and Dechert LLP, to complete mutual due diligence as soon as practicable. We are also prepared to work diligently to negotiate and sign a definitive merger agreement with Medicis. In addition to finalizing a definitive merger agreement, our proposal is subject to satisfactory completion of due diligence.
We believe that a merger with Mentor would be the best way for Medicis to enhance stockholder value. Please consider our request to meet promptly so that we may give you additional information, complete due diligence and negotiate and finalize a merger agreement. We have considered with our advisors all legal and other requirements relating to a merger between Mentor and Medicis and do not foresee any difficulties in completing the prompt combination of our companies.
We are excited about the opportunity a combination of our two companies would present and look forward to hearing from you soon.
Very truly yours,
Mentor Corporation
Joshua H. Levine
President, Chief Executive Officer and Director
<<
[As if things weren’t complicated enough already in these machinations over the fate of these breast-implant and facial aesthetics businesses, now MNT has stepped into the fray. To recap: MRX, which sells the premier dermal filler, Restylane, offered to buy IMDC, which sells breast implants and some second-rate dermal fillers and is developing a botulinum-toxin competitor to Botox that was licensed from Europe. AGN, which makes Botox, then offered to buy IMDC on better terms than MRX’s offer and even promised to sell IMDC’s botulinum toxin to assuage anti-trust concerns (although I have my doubts about the sincerity of this offer). Now, MNT, who competes with IMDC in breast implants and dermal fillers and is developing yet another botulinum toxin that may turn out to be the best in the business, has offered to buy MRX, based on the assumption that MRX will no longer be buying IMDC. (MNT’s and IMDC’s businesses under the same corporate umbrella would be an obvious anti-trust problem in breast implants). However, MRX says no dice to MNT, which leaves MRX free to raise their bid for IMDC to exceed AGN’s bid or to simply remain as they are. The text of MNT’s letter to MRX is appended to the end of this PR.
Is all this completely clear?
] http://biz.yahoo.com/bw/051120/20051120005024.html?.v=1
>>
Sunday November 20, 6:27 pm ET
SCOTTSDALE, Ariz.--(BUSINESS WIRE)--Nov. 20, 2005--The Board of Directors of Medicis (NYSE: MRX ) has unanimously rejected an unsolicited proposal by Mentor Corporation (NYSE: MNT ) to acquire Medicis by exchanging 0.62 of a share of Mentor for each share of Medicis. The Medicis Board confirmed that Medicis remains committed to completing its proposed merger with Inamed Corporation (NASDAQ: IMDC ).
The Board stated, "We are focused on maximizing stockholder value now and in the future. The proposal by Mentor is inappropriate in light of the recent trading history of the two companies and the pending stockholder votes on the Inamed merger. We continue to unanimously recommend that our stockholders vote in favor of our proposed merger with Inamed as we believe that a combination with Inamed will maximize stockholder value."
A more complete description of the proposed merger with Inamed is set forth in the registration statement on Form S-4, as filed by Medicis on November 16, 2005, with the U.S. Securities and Exchange Commission. Medicis and Inamed have each scheduled stockholder meetings on December 19, 2005 for their stockholders to consider this merger.
…
TEXT OF PROPOSAL LETTER
November 18, 2005
Mr. Jonah Shacknai
Chairman of the Board
and Chief Executive Officer
Medicis Pharmaceutical Corporation
8125 North Hayden Road
Scottsdale, Arizona 85258
Dear Jonah:
We are pleased to submit for your consideration a proposal for the combination of Medicis Pharmaceutical Corporation and Mentor Corporation. We believe that this combination offers your stockholders substantially greater value than your pending transaction with Inamed and will create a global leader in the aesthetics market that would benefit all Medicis and Mentor constituencies. We believe this offer constitutes a superior proposal as contemplated by your merger agreement with Inamed Corporation.
Mentor is proposing a merger of Medicis and Mentor in a transaction that would provide the Medicis stockholders with an equity ownership interest of approximately 44% in the combined company on a fully diluted basis. Specifically, we are proposing a stock-for-stock transaction in which Medicis stockholders will receive 0.62 shares of Mentor common stock per Medicis share. Based on closing prices on November 18, 2005, this represents total equity consideration of approximately $2.2 billion and offers Medicis stockholders a 25% premium for their shares.
The strategic rationale for the Mentor/Medicis combination is compelling. Aesthetic medicine is a dynamic marketplace undergoing transformative changes. The market has expanded to include a large, growing number of non-surgically oriented procedures, primarily in the facial rejuvenation arena. At the same time, there has been an influx of new providers and distribution outlets emerging in the market, offering patients expanded access to a variety of procedures. Mentor's leadership in the plastic surgery market is based on the quality and breadth of its product offerings and the reputation we have established based on our dedication to customer service and value added support programs. Similarly, Medicis' leadership in the dermatology and cosmetic dermatology markets is based on the breadth of its product offerings and reputation for market leading sales focus and customer service. The combined product portfolios of the two organizations establish a strong basis for sustainable competitive advantage in both the surgical and non-surgical cosmetic procedures market segments.
The two companies are category leaders in their respective market segments with strongly positioned brands. The resulting organization will have comprehensive distribution capabilities across a broad array of outlets including private practice physician offices and clinics, hospitals, surgery centers, and medi-spas. Given the complementary fit, we would expect that the existing sales organizations of each company would continue to serve their respective customers with substantial opportunities to leverage each other's expertise for the benefit of the combined company and its customers.
The combination of Medicis and Mentor would create a global leader in the rapidly expanding aesthetics market, with combined annual revenues in the 12 months ended September 30, 2005 of nearly $900 million, direct selling operations in 12 countries with independent distributor relationships in over 60 countries and over 2,300 employees. The combined company would have a scalable platform into which it could integrate other products and technologies and rapidly introduce those products to the combined customer base.
Jonah, we at Mentor have great respect for you and your leadership capabilities. We envision a merger in which you and your management team will play an integral role in defining the leadership and strategy of the combined company. We look forward to discussing with you a governance structure that creates the greatest value for our new company, with a combination of directors from both companies continuing to serve after the closing of our merger.
A Mentor/Medicis merger is an exciting opportunity for both our companies. Mentor is prepared to execute an appropriate confidentiality agreement and, together with our financial advisors, Goldman, Sachs & Co. and Citigroup Global Markets Inc., and our legal advisors, Wilson Sonsini Goodrich & Rosati, P.C., and Dechert LLP, to complete mutual due diligence as soon as practicable. We are also prepared to work diligently to negotiate and sign a definitive merger agreement with Medicis. In addition to finalizing a definitive merger agreement, our proposal is subject to satisfactory completion of due diligence.
We believe that a merger with Mentor would be the best way for Medicis to enhance stockholder value. Please consider our request to meet promptly so that we may give you additional information, complete due diligence and negotiate and finalize a merger agreement. We have considered with our advisors all legal and other requirements relating to a merger between Mentor and Medicis and do not foresee any difficulties in completing the prompt combination of our companies.
We are excited about the opportunity a combination of our two companies would present and look forward to hearing from you soon.
Very truly yours,
Mentor Corporation
Joshua H. Levine
President, Chief Executive Officer and Director
<<
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