Botox maker Allergan eyes Shire bid
Tuesday 29 April 2014
Botox maker Allergan is considering a takeover of drugs firm Shire as the deals frenzy in the pharmaceuticals industry intensifies.
Allergan is considering making a new bid for the FTSE 100 company, according to Reuters, hot on the heels of US giant Pfizer attempting to buy rival AstraZeneca in a possible $105 billion (£62.4 million) deal and GlaxoSmithKline agreeing a multi-billion dollar asset swap with one of its rivals.
Allergan — itself fighting a $47 billion takeover bid from Valeant and activist investor Bill Ackman — is gearing up for another punt at Shire after having failed with an previous attempt in recent months.
In response, shares in Shire today gained 3.8% to 3411p, making them the top risers on the blue-chip index.A combination of Allergan and Shire would create a pharmaceutical giant with a combined market value of almost $72 billion and annual sales of more than $11 billion. Analysts believe Allergan would use Dublin-based Shire to lower its tax.
News of the potential deal comes after Pfizer yesterday took its battle to buy AstraZeneca public, saying it had been rebuffed by the firm for a second time at the weekend.
The pharmaceutical sector also saw GlaxoSmithKline sell its cancer drugs business to Novartis last week, with the Swiss firm’s vaccines unit going in the opposite direction.
Elsewhere, US generic drugs maker Mylan has had two bids rejected to buy Sweden’s Meda.
In the wider healthcare industry, recent M&A activity has included Zimmer Holdings, the US maker of medical devices, agreeing to buy rival Biomet in a deal worth $13.4 billion. Analysts have said that this could be a prelude to further consolidation in the medical equipment sector, speculating that British-based hip-joint maker Smith & Nephew could be a target for Johnson & Johnson.
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