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Rep. Royce Questions SEC Corporation Finance Director on Allergan Takeover Issue

July 24, 2014



July 24, 2014

Contact: Saat Alety (202) 225-4111

Rep. Royce Questions SEC Corporation Finance Director on Allergan Takeover Issues

Washington, D.C. - U.S. Representative Ed Royce (R-Calif.) questioned the U.S. Securities and Exchange Commission's Director of Corporation Finance Keith Higgins on issues raised by the recent hostile takeover bid by Valeant Pharmaceuticals and Pershing Square Capital Management for Allergan Inc. at today's House Financial Services Committee's "Oversight of the SEC'sDivision of Corporation Finance" hearing. Rep. Royce questioned Mr. Higgins about the possibility of insider trading violations associated with novel or creative deal structures.

"Simply labeling something a 'joint-bid' should not make what would otherwise be illegal trading legal insider trading," said Rep. Royce. "I share Mr. Higgins' stated goal that investors always get clear and accurate information. The SEC should use that test when looking at any newfangled takeover bid."

Rep. Royce previously wrote SEC Chair Mary Jo White in May to express concern over early efforts by Pershing Square to call a non-binding shareholder vote outside typical proxy procedures. Pershing Square dropped plans for the shareholder referendum shortly thereafter. In her July reply, Chair White wrote that the Division of Corporation Finance will continue to consider issues raised by the filing related to the abandoned shareholder referendum, as well as issues raised by any future filings of a similar nature.

The SEC's Division of Corporation Finance is responsible for ensuring that investors are provided with material information in order to make informed investment decisions. This includes disclosure requirements when a company initially offers its securities to the public and on an ongoing basis as the company continues to provide information to the marketplace. The division also provides interpretive guidance to companies regarding SEC rules and forms, and makes recommendations to the Commission on new rules and revisions to existing rules.

Rep. Royce is a senior member of the House Financial Services Committee and represents parts of Orange County, California, which encompasses the global headquarters of Allergan, Inc.

Watch Rep. Royce's opening statement and questioning of Higgins at http://royce.house.gov/Components/Redirect/r.aspx'ID=449940-67941562

For more information, contact Saat Alety at saat.alety@mail.house.gov or (202) 225-4111.


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Source: Congressional Documents & Publications


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