(Legal Newsline) — The Securities and Exchange Commission (SEC) announced Jan.
17 that Allergan Inc. will pay $15 million in penalties after allegedly
violating securities law when failing to make proper disclosures after a
hostile takeover bid.
to the SEC, Allergan received a tender offer from Valeant Pharmaceuticals and
co-bidders in 2014. After receiving the offer, Allergan made a public statement that it would not accept the offer.
SEC rules mandate that Allergan needed to
amend the filing if a material change occurred. Allergan allegedly failed to do
this when another company came into the merger picture after the Valeant talks.
The SEC alleges the investing public was never made aware that Allergan had entered merger talks with Actavis, the company that eventually acquired
Allergan, until after the merger had been executed.
“Allergan failed to fully and timely disclose information
about potential merger transactions it was negotiating behind the scenes in
response to the Valeant bid,” said Andrew M. Calamari, director
of the SEC’s New York Regional Office.
“As outlined in our order, Allergan was slow to act even
after SEC staff reminded the company about its disclosure obligations.”
Lehmann, Mark Germann, and Charles Riely of the SEC's New York office handled the
case, which was supervised by Sanjay Wadhwa.