NEW YORK (TheStreet) -- Jim Cramer took a long look at the $5.6 billion buyout of Questcor Pharmaceuticals (QCOR) by Mallinckrodt Pharmaceuticals (MNK - Get Report) on CNBC's "Cramer's Mad Dash" segment Tuesday.
Both stocks shot higher on Monday's announcement, said TheStreet's Cramer, co-manager of the Action Alerts PLUS portfolio. However, it didn't take long for Mallinckrodt shares to start falling to almost $55 by noon on Monday. Eventually the stock closed near $61. Shares are now up slightly to $62.
"People hate this deal," Cramer said. Questcor is under investigation by the Department of Justice for its promotional practices. It is seen as a one-product company, making it difficult for Mallinckrodt investors to understand why the need to make this acquisition, he added.
Cramer spoke with Mark Trudeau, president and CEO of Mallinckrodt, on Monday's Mad Money and the executive argued Questcor is a great acquisition. Cramer said Trudeau made clear his company did its due diligence on Questcor regarding its promotional practices, and everything checks out just fine.
During the program Cramer said that with this deal Mallinckrodt is "incredibly inexpensive."
Tuesday, however, he noted only that "people do not trust this deal."
-- Written by Bret Kenwell in Petoskey, Mich.