Drugmaker Shire bids $30 billion for Baxter spin-off Baxalta

Tue Aug 4, 2015 4:22pm EDT
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By Paul Sandle

LONDON (Reuters) - Drugmaker Shire (SHP.L: Quote) said on Tuesday it was seeking to buy Baxalta BXLT.N, a company spun-off by Baxter International (BAX.N: Quote) last month, for $30 billion to forge the leading global specialist in rare diseases.

The London-listed group went public with its approach after the U.S. firm turned it down during private talks last month.

Baxalta rebuffed the offer on Tuesday and said in a statement that Shire's unsolicited offer significantly undervalued the company.

Shire's all-share offer values each Baxalta share at $45.23, based on Aug. 3 market prices. Baxalta's shares closed up nearly 12 percent at $37.10. Shire's stock closed down about 6 percent.

The Illinois-based firm, which has a staff of around 16,000, develops biotech treatments for rare blood conditions, cancers and immune system disorders. It had proforma revenue of $6 billion in 2014.

Baxalta offers Shire a promising range of new products to complement its growing portfolio of high-priced treatments for rare or "orphan" diseases, analysts said. But there is no guarantee that Shire, itself the target of a failed takeover in 2014, will land its prey.

"Shire may need to go hostile and success rates of pharma hostile bids are low," said Leerink analyst Jason Gerberry.

Shire said it would create an unrivalled rare diseases champion with product sales of around $20 billion by 2020 and double-digit percent annual sales growth.   Continued...

Ludwig Hantson (C), Chief Executive Officer of Baxalta, celebrates the company's IPO after ringing the opening bell above the floor of the New York Stock Exchange, July 1, 2015.  REUTERS/Lucas Jackson