Horizon Pharma PLC (NASDAQ:HZNP) has recently been making efforts to make a hostile bid to acquire Depomed Inc for $2.4 billion. The initial bid was to trade 0.95 of HZNP in return for 1 share of Depomed. HZNP targets patients suffering from arthritis, while Depomed manufactures painkillers.

The initial deal translates to $33 per share for Depomed stockholders. However, Depomed is reported to have rejected the $33 per share offer, stating that it does not reflect on the value of a combined company. Analysts believe that this is being done, to prevent any hostile takeovers of the company, by making it too expensive.

Since Horizon Pharma already owns 3.7% of Depomed shares, the company has begun efforts to call for special shareholder meetings, in a bid to replace its board of directors. Furthermore, the company has also mailed several Depomed shareholders solicitation material. The mails also included statements from Horizon Pharma, clarifying why the merger was in best interest of the shareholders. Additionally, the two special meetings would call for the replacement of the complete board of directors of Depomed and repeal recent changes to company bylaws.

As per company bylaws, if 10% of the shareholders agree, they can call special meetings to discuss the fate of the company. Horizon currently needs the support of 6.3% shareholders to surpass that threshold. Since HZNP made its offer public, Depomed has altered its bylaws in order to delay the calling of special shareholder meetings and limited the rights of shareholders to maximize their investment in the company.

The CEO of HZNP, Timothy P. Walbert, stated that his company has been more than willing to sit and discuss the proposed deal with the current Depomed board. However, unfortunately, the board has refused to engage in a meaningful dialogue with Horizon, even after HZNP offered 32% share to Depomed in the combined company. Mr. Walbert believes that these actions have left them with no choice, but to seek help from shareholders for decisive action.

Horizon Pharma PLC (NASDAQ:HZNP) gained 0.67% during the September 23 session to reach a close at $25.96.