Baxalta (BXLT) Stock Gained on Reports of New Takeover Bid from Shire

Baxalta Inc. shares jumped on a report that Shire Plc is preparing a new takeover offer for the drugmaker, which had rejected an earlier bid. It’s understood Shire is working with Deutsche Bank, Evercore and Morgan Stanley on the offer.

It was about four months ago when Baxalta (NYSE:BXLT) rejected an unsolicited $30B offer from Shire (NASDAQ:SHPG), and now Reuters reports a new proposal is being prepped.

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.

“We believe the proposed combination of Shire and Baxalta would be strategically and financially attractive for both of our companies, accelerating our respective growth ambitions and creating the leading global biotech company in rare diseases”, chief executive Flemming Ornskov recently said.

Baxalta has a market capitalization of about $24.8 billion, and would contribute to Shire’s portfolio of treatments for rare diseases.

On Aug. 3 Shire valued each Baxalta share at $45.23. By 13:30 GMT, Shire’s shire price had fallen 2.13 percent to 4,546.00p.

Shire has been attempting a takeover of Baxalta for the past six months, Reuters notes. 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”.

Reuters adds that Shire will also be facing Baxalta’s state-of-the-art takeover defense that has a “poison pill”, which effectively stops suitors buying more than 10 percent of the company.