By Greg Roumeliotis
(Reuters) - Generic drug maker Mylan NV's (O:MYL) $26 billion (17 billion pounds) hostile bid for peer Perrigo Company Plc (N:PRGO) looked unlikely to succeed late on Thursday, a few hours before it was set to expire, according to people familiar with the matter.
If confirmed, the outcome would represent a major victory for Perrigo's defiant Chief Executive Joseph Papa, and a bitter blow to Mylan's Executive Chairman Robert Coury, who snubbed an acquisition offer from Teva Pharmaceutical (N:TEVA) Industries Ltd (TA:TEVA) to pursue Perrigo.
Around 40 percent of Perrigo's ordinary shares had been tendered ten hours before the tender offer was due to expire on Friday, significantly short of Mylan's acceptance threshold of more than 50 percent, the people said.
While more shares could still be tendered, many large institutional investors would have tendered their shares at this stage if they were going to accept the offer, the people added.
The sources declined to be identified because the tally is not yet official. Perrigo declined to comment, while representatives for Mylan did not immediately respond to requests for comment.
Mylan, which first made a bid for Perrigo in April, went hostile in September, offering $75 in cash and 2.3 of its shares for each Perrigo share.
The deal's rejection will now focus investors' attention on Perrigo's standalone strategy. Papa has said he is open to dealmaking, and sources familiar with the matter said earlier on Thursday Perrigo had held merger talks with Endo International Plc (O:ENDP) earlier in the fall.
Perrigo reported a better-than-expected profit for the third quarter last month, and said it would lay off 6 percent of its global workforce and buy back shares worth $2 billion.
Mylan had used a Dutch poison pill-style defence to fight a $40 billion takeover by Teva, arguing that a deal was "without sound industrial logic or cultural fit" and that it would face regulatory hurdles.
Coury said last week that, while the purchase of Perrigo was good for both companies, Mylan could survive without it. He pointed to the very strong market position of EpiPen, Mylan's biggest-selling branded product, which treats emergency anaphylactic reactions to allergens.