Shire prepares bids for Actelion and Radius in case Baxalta deal fails
Shire (LON: SHP), the Ireland-headquartered pharmaceutical company, is preparing several deals in the event that a proposed USD 30bn takeover of Baxalta (NYSE: BXLT) fails, The Sunday Times reported.
According to senior sources in the City, Shire has engaged investment banks to prepare deals for a number of other potential takeover targets, the report said.
Switzerland-based Actelion (XETRA: ACT) and Radius Health (Nasdaq: RDUS) of Cambridge, Massachusetts, are thought to be among Shire’s targets, the item reported. It added that analysts believe Cambridge, Massachusetts-based Ariad Pharmaceuticals (Nasdaq: ARIA) might also be a potential target.
Shire needs to find deals to expand and thus prevent its own takeover by predators, the report said. It added that Shire will probably pursue its other acquisition targets even if its takeover of Baxalta goes ahead.
Individuals working on Shire’s potential deals said Chief Executive Flemming Ornskov had become frustrated at a dearth of action in the wake of the company’s offer for Baxalta. However, in recent months his eyes have been opened to other prospective deals, leading him to place less importance on the Baxalta takeover - although it is still the number-one priority, the report said.
According to people with close links to Shire, the company is waiting for its share price to climb before making any new approach to Baxalta. One unidentified investor quoted in the piece said Shire is attempting to approach a deal quietly and is waiting until it is in a better position to make an offer.
Another source predicted Baxalta will ultimately accept a deal approaching USD 50 per share, up from Shire’s initial USD 45.23-per-share offer, the item reported. Baxalta is currently “talking tough”, the source said.
The original article appeared in print; Business section, page 3
Source Sunday Times