LONDON: US drugmaker AbbVie raised its offer for Shire to £30.1bn ($51.3bn) yesterday, hoping to win over its reluctant target after three earlier offers were rejected.
The latest £51.15 a share cash-and-stock offer is 11 percent higher than AbbVie’s previous proposal of £46.26, which the London-listed hyperactivity and rare diseases specialist had said fundamentally undervalued the company. Industry analysts said it was unlikely to be enough to get a deal done. Shire said its board would meet to consider the higher offer, which it added it did not receive before AbbVie announced it to the market.
Shares in Shire fell on disappointment the US group had not offered more, or raised the proportion of cash, amid worries that the two sides might not be able to agree a final price. AbbVie also slid, reducing the stock element of its bid. AbbVie is eager to buy Shire both to reduce its tax bill by moving its tax base to Britain — a tactic known as inversion — and to diversify its drug portfolio. The US company currently gets nearly 60 percent of its revenue from rheumatoid arthritis drug Humira, the world’s top-selling medicine, which loses US patent protection in late 2016.
Chief Executive Richard Gonzalez has pressed the case for his pursuit of Shire in a series of meetings with shareholders on both sides of the Atlantic, after setting out the strategic rationale for a deal on June 25.
AbbVie said it and its financial adviser JP Morgan had now met with, or spoken to, Shire investors who represented a majority of Shire’s shares. Reuters
