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Medicis Walks Away From Inamed

Medicis (MRX) on Tuesday announced the end of its nine-month courtship of Inamed (IMDC) after having been outbid by Allergan (AGN).

Medicis, a Scottsdale, Ariz., company that specializes in skin disease and skin-treatment products, said it would collect a $90 million break-up fee from Inamed according to the terms of their March 20 agreement.

"After careful evaluation by the board of directors with consultation from outside counsel and financial advisers, we have concluded that it is in the best interests of Medicis shareholders not to raise our offer for Inamed," said Jonah Shacknai, chairman and chief executive of Medicis.

The company's decision comes seven days after the Dec. 6 deadline that it had set for Inamed, of Santa Barbara, Calif., to reject the competing offer from Allergan. Inamed focuses on skin-care products and breast implants. Allergan, of Irvine, Calif., makes eye-care medications and the Botox wrinkle treatment.

Allergan offered $84 in cash or 0.8498 shares for each share of Inamed. The deal is worth about $3.2 billion. Inamed's board recently said that although Allergan's offer was superior, the board was neutral on the competing bids.

Medicis had offered $30 plus 1.4205 shares for each share of Inamed. The deal was originally worth about $2.8 billion, or $75 a share. The price of Medicis' stock has oscillated since the original bid, and based on Monday's closing price, the offer was worth $77.31 a share.

Medicis backed away from Inamed one day before the companies had been scheduled to hear from the Federal Trade Commission about potential antitrust issues. The FTC previously asked the companies for more information. Last month, Medicis said it had sent to the FTC "substantially all" of the information that the agency had requested.

On Tuesday, a Medicis spokeswoman declined to comment when asked if her company had heard from the FTC. She also declined to comment on whether Medicis had received any new communication from Mentor (MNT), which made an unsolicited, stock-swap bid of $2.2 billion for Medicis last month. The offer was rejected.

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