Delaware’s Supreme Court ruled last week to uphold a decision by the state’s Chancery Court that Fresenius (ETR:FRE) could walk away from its $4 billion merger with Akorn (NSDQ:AKRX).
The initial deal was designed to help Fresenius move into new therapeutic areas and dosage forms, including eye drugs, ear drops, nasal sprays and respiratory drugs. But Fresenius abandoned the purchase in April, pointing at an investigation that found material breaches of FDA data integrity requirements related to Akorn’s operations.
Akorn, responding to Fresenius’ decision, sued in Delaware’s Court of Chancery in an attempt to force the company to follow through with its deal. But the court ruled in early October that it couldn’t force Fresenius to go through with the merger.
Akorn issued a statement following the Supreme Court’s decision, writing that the ruling was “disappointing,” but that it would “move forward and rebuild shareholder value as an independent company.”
Akorn’s board also announced that CEO Raj Rai plans to retire and that the company is looking for a new chief executive.
“We recognize that this has been an extended period of uncertainty for Akorn’s customers, employees and investors and the Board is committed to ensuring the company’s stability and long-term growth,” chairman Alan Weinstein said in prepared remarks. “While there is work to do, Akorn’s future remains bright thanks to its manufacturing, quality and generics expertise and is not dependent upon a consummated transaction with Fresenius.”
