Irvine, Calif.-based Allergan has announced its board of directors has unanimously adopted a one-year stockholder rights plan effective April 22, and declared a dividend distribution of one preferred share purchase right on each outstanding share of the company's common stock.

The company said it had become aware of the recent rapid and previously undisclosed accumulation of a significant amount of the company's common stock in connection with an acquisition proposal made by Valeant Pharmaceuticals International. The unsolicited proposal from Valeant was to acquire all outstanding shares of the company for a combination of 0.83 of Valeant common shares and $48.30 in cash per share of common stock.

Allergan said the stockholder rights plan is not intended to prevent an acquisition of the company on terms the board considers favorable to, and in the best interests of, all stockholders. Rather, it aims to provide the board with adequate time to fully assess any proposal.

Under the plan, stockholders of record at the close of business May 8 will receive one right for each share of Allergan common stock held on that date. The distribution of the rights is not taxable to stockholders, and the plan is scheduled to expire April 22, 2015.

Subject to limited exceptions, the rights will become exercisable if a person or group acquires beneficial ownership of 10% or more of Allergan's common stock (including in the form of synthetic equity positions created by derivative securities). In that situation, each holder of a right (other than such person or members of such group, whose rights will become void and will not be exercisable) will be entitled to purchase a number of Allergan's common shares for $500 that have a market value of twice the exercise price of the right.

Stockholders are not required to take any action to receive the rights distribution. Until the rights become exercisable, they will trade with the shares of the company's common stock. The plan will not have an impact on the reported earnings per share of the company and will not change the manner in which the Company's common stock is currently traded.

Details about the plan will be contained in a Form 8-K to be filed by Allergan with the U.S. Securities and Exchange Commission.