Medeva revealed on 8 September that it was in talks with an unnamed bidder and has since refrained from naming the company in question. Dr Bill Bogie, chief executive, said the board had had no hesitation in rejecting the subsequent cash offer. He declined to indicate the value of the bid.
However, sources confirmed the bid was 158p per share and that it came from Elan. They added that the Dublin company might take the bid hostile. Elan declined to comment.
"I'm sure we could have negotiated a few pennies here and there, but the offer was so far below the valuations put on the company by our advisers there was no point," Dr Bogie said.
Dr Bogie said Shire had approached the group in July in what was nothing more than a "dalliance", which had not resulted in formal talks. Previously, the group had declined to comment on rumours that talks between the two had collapsed. Dr Bogie said talks with Shire remained a possibility. He also rejected suggestions that Medeva directors were facing mounting shareholder criticism.
Medeva shares fell 22 per cent, to 132p, valuing the company at pounds 451m. The shares were at 122p on the day before talks were announced.