Another hostile step for Valeant in its hot pursuit of Allergan

Valeant CEO J. Michael Pearson

When it comes to their bid for Allergan ($AGN), hostile isn't the preferred approach for Valeant ($VRX) and takeover partner Bill Ackman, CEO J. Michael Pearson told investors Tuesday. But it's the one the team is going with.

Valeant plans to put an exchange offer to Allergan shareholders this week, paving the way for it to eventually take its $53 billion bid directly to shareholders, Reuters reports.

Ackman's Pershing Square Capital Management--Allergan's largest shareholder--will need to garner the support of 25% of shareholders to call a special meeting to replace the company's directors. To do so, it intends to mail out proxy materials as soon as this month as it looks to pad the 9.7% interest its stake already represents.

"It is clear Allergan and their board will never sit down in the interest of their shareholders," Pearson said on a conference call, as quoted by CNBC. "If Allergan were as confident as they claim to be they should be happy to have a shareholder vote right away."

Tensions have escalated between the two drugmakers over the past week, with both sides expressing their opinions in no uncertain terms. Monday, Allergan went so far as to publish an email excerpt in which one banker from Morgan Stanley--now working for Valeant--said it would help persuade shareholders and the media that Valeant is "a house of cards," The Wall Street Journal reports.

But Pearson, ever the confident M&A architect, shrugged it off, insisting that Morgan Stanley was still "very much on our team."

"It's clear that Allergan's release is a sign of desperation," he said in a statement. "We look forward to proving the naysayers wrong."

- read the Reuters story
- get more from CNBC
- see the WSJ piece (sub. req.)

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