CHICAGO, Nov 21 (Reuters) - Breast implant maker Mentor Corp. ( MNT ) remained bullish on Monday about a potential linkup with wrinkle treatment maker Medicis Pharmaceutical Corp. ( MRX ) , despite having its $2.2 billion bid rebuffed on Sunday.
"We're confident that once the dust settles here, we'll arrive at a transaction that benefits both sets of shareholders," Joshua Levine, president and chief executive of Mentor, said in an interview.
Mentor on Sunday revealed terms of its stock-for-stock bid to buy Medicis, a deal Levine said would add to earnings from the outset.
Medicis, which is trying to acquire Mentor's chief rival Inamed Corp. ( IMDC ) , unanimously rejected Mentor's offer as inappropriate, citing pending shareholder votes on its $2.5 billion offer for Inamed.
Last week, Allergan Inc., ( AGN a maker of popular wrinkle-treatment Botox, swept in with a richer bid for Inamed of $3.2 billion, leaving many to speculate that the Medicis deal was dead.
The companies are clamoring for prime position in the $12.5 billion U.S. market for nonsurgical treatments to erase the signs of aging, a market that has grown 700 percent since 1997.
Shares of Medicis surged 16 percent on Monday on the New York Stock Exchange, while shares of Mentor Corp. ( MNT ) tumbled more than 8.5 percent.
Levine was undaunted by Medicis' rebuff. "From our view, it's a great situation for shareholders. The strategic rational is in place. It offers them the same strategic benefits on more favorable economic terms," he told Reuters.
On a conference call, he said Medicis needed to follow a specific process that had been spelled out and urged the opportunity to sit down with Medicis' board. "I would find it hard to believe that they would not entertain this offer from Mentor," said one arbitrageur who asked not to be named.
CIBC World Markets analyst John Calcagnini said Mentor's offer for Medicis, which makes drugs to treat skin problems, is consistent with Mentor's goal of moving into nonsurgical cosmetic treatments. "By our estimation, the deal would be accretive to Mentor from the outset and would be a cheap way for them to acquire a dermatology sales force," Calcagnini said.
Shares of Mentor fell $4.76 to $51.38, while Medicis surged $4.41 to $32.16, in afternoon trading, both on the New York Stock Exchange. <<
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