US drug firm AbbVie yesterday made a hotly anticipated fourth takeover bid for UK rival Shire, bumping up its previous offer by 11 per cent to bid £30.1bn for the group.
Shares in Shire closed down 2.6 per cent after the company told investors to wait until its board had met to discuss the proposal before publicly backing or rejecting the offer.
“Shire confirms that AbbVie did not make the revised proposal to Shire before the announcement,” the company said in a statement.
AbbVie said it would increase its offer to £51.15 a share, up from the previous £46.26 a share bid.
More than half of the offer comes in the form of new shares in the merged entity, which could be based in London, with a further £22.44 in cash.
AbbVie said the offer was based on discussions with Shire’s biggest shareholders over price.
Chairman and boss Richard Gonzalez said: “AbbVie has made a compelling offer to Shire that creates immediate and long-term value to shareholders of both companies. We think its shareholders should strongly encourage the Shire board to engage in constructive dialogue with AbbVie.”
Shares in the US group closed down nearly three per cent in response to the increased offer. Shire and AbbVie now have until 18 July to do a deal before a Takeover Panel deadline expires.
“It’s designed to increase pressure on Shire’s management to engage, with a view to settling on a recommended offer, which we would imagine will be greater than £51.15 but not higher than £55,” Panmure Gordon’s Savvas Neophytou said.
The deal has similarities to Pfizer’s £69bn bid to takeover UK drug giant Astrazeneca. The takeover fell through after Pfizer came in with a final bid for the group which was turned down by Astra’s board, scuppering the chance for negotiations on the price. M&A activity in the pharma sector has had a bumper record so far this year.