Shire makes unsolicited $30.6bn bid to acquire Baxter spin-off Baxalta

The proposal made by Shire was to combine the companies in an all-stock transaction pursuant to which Baxalta shareholders would receive, for each Baxalta share, 0.1687 Shire ADRs.

Under the proposal, Shire is offering Baxalta holders 0.1687 ADRs for each Baxalta share, implying a value of $45.23 per Baxalta share and a premium of 36%.

Shire noted that Baxalta declined to engage in substantive discussions regarding the proposal.

The combined company is expected to accelerate the growth plans of both the companies an d could also deliver $20bn in product sales by 2020.

It is also expected to bring new therapies to market for patients with rare, often lifethreatening, diseases and conditions.

Shire chief executive officer Flemming Ornskov said: "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.

"The combined entity would have the opportunity to create significant shareholder value in one of the most attractive and fastest growing segments in healthcare. Together, the companies would be projected to deliver $20bn in product sales by 2020, with the financial and operational firepower to fuel further innovation and growth in rare diseases.

"It is our strong preference to immediately enter into a negotiated transaction to explore the full potential of the proposed combination and finalize the terms of an agreement."

Following completion of the transaction, Shire said it would start a share buyback program and, within two years, repurchase up to 13% of the combined company’s outstanding shares.

Image: Shire offers $30bn to buy drug maker Baxalta. Photo: courtesy of FreeDigitalPhotos.net / Wagging Dog Media Limited.