Baxalta, which now has a market capitalisation of almost $23 billion, in August rejected the unsolicited takeover bid saying that the offer significantly undervalued the company. It is understood that Shire is now working with Deutsche Bank, Evercore and Morgan Stanley on a new offer, which could be structured in cash and shares.
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Should the deal be completed, the merger would create one of the world’s leading specialists on rare diseases, according to Reuters. Given the intense opposition of Baxalta’s board to the initial stock-based bid, Gerberry said “the consensus assumption is that either the Baxalta deal will “go away” over time or that Shire will re-emerge with a revised bid that includes cash”.
Shire’s new bid preparation comes three weeks after it announced that it has purchased Dyax Corp., a USA rare disease specialist, for $5.9 billion.
Baxalta offeres Shire a promising range of new products to complement its expanding portfolio of high-priced treatments for rare or “orphan” diseases, and a combined company would see revenues of over $20 billion a year by 2020. Its share price has dropped more than 26 percent since then, and was trading around $33 at 2000 GMT (1500 ET) on Tuesday.
“He’s never given up”, says a source, talking about CEO Flemming Ornskov’s designs on Baxalta.
Baxalta, advised by Goldman Sachs, said Shire’s bid did not reflect its potential as a newly listed company which expects its shares to rise as it becomes better known.
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Baxalta was a new entrant to the market, having been spun off by Baxter global in July.
