* Bitter battle moves to courtroom after buyback approved
* Shareholders reject Elan's $1 billion Theravance deal
* Elan put itself up for sale on Friday
By Padraic Halpin
DUBLIN, June 17 Elan shareholders
approved a share buyback on Monday, meaning U.S.-based Royalty
Pharma's hostile bid for the Irish drug firm will
lapse unless it succeeds in a legal challenge.
Royalty, hoping to convince Elan's owners to accept its bid
in the face of opposition from its target's board, last month
made its takeover offer conditional on shareholders voting down
all resolutions at Monday's meeting.
Shareholders rejected the company's proposed $1 billion
royalties deal with U.S company Theravance Inc, the
purchase of private drug firm AOP Orphan and a drug spin-off, in
a major blow to Elan management's strategy.
The company put itself up for sale on Friday.
However their approval of a $200 million share buyback could
force Royalty to either join the sales process with an increased
bid or walk away. Elan said it would release detailed results of
the resolutions later on Monday.
Desperate to stay in the fight, Royalty last week won an
Irish court injunction against Ireland's regulator on takeover
battles, allowing it to appeal against a ruling that it cannot
change the conditions attached to its offer.
Royalty, whose current bid is worth a potential $8 billion,
says it meant its conditionality to apply to only the two
resolutions relating to acquisitions. The hearing to determine
whether it can appeal is scheduled for Wednesday.
Royalty's current bid offers $13 in cash per share as well
as a "contingent value right" that could add a further $2.50 per
share if blockbuster drug Tysabri hits certain sales milestones.
Shareholders have a week to decide on whether to accept the
offer, the investment firm's third in five months. It requires
the backing of 50 percent plus one share to go through, as well
as a successful appeal in the courts.