Shire share price jumps again as analyst forecasts ‘imminent’ bid
iNVEZZ.com, Wednesday, June 18: Shares in Shire Plc (LON:SHP) have jumped more than four percent in London this afternoon after an analyst said that Botox maker Allergan (NYSE:AGN) was planning to make a bid for the FTSE 100 biopharma group.
**Shire share price soars again**
As of 15:08 BST, Shire’s share price had added 4.56 percent to 3,827.00p, climbing to the top of the FTSE 100 leaderboard. The company’s shares are currently trading 4.25 percent higher at $194.81 on the NASDAQ where Shire is listed under the ticker symbol SHPG.
Bloomberg quoted John Boris, an analyst at SunTrust Robinson Humphrey, as saying in a report that buying Shire would allow California-based Allergan to diversify into drugs for rare diseases and would provide a lower corporate tax rate.
“We believe an AGN bid for SHPG is imminent,” Boris wrote, adding that such a deal made “strategic sense”.
The news came hot on the heels of yesterday’s report that Shire had hired Citi to advise it on potential takeover proposals amid a wave of deals in the pharmaceuticals and healthcare sector. (Shire share price soars as company braces for takeover proposals)
Are you looking for fast-news, hot-tips and market analysis? Sign-up for the Invezz newsletter, today.
Bloomberg quoted Jessica Mann, a Shire spokeswoman, as saying in an e-mail that the company never comments on speculation, while Bonnie Jacobs, a spokeswoman for Allergan, told the newswire that the drugmaker does not comment on rumours.
Shire, a frequent subject of takeover speculation on account of its growing rare diseases portfolio and its Irish tax domicile, has reportedly attracted Allergan’s interest as the Botox maker is trying to fend off an unsolicited approach from Valeant Pharmaceuticals (TSE:VRX). Some analysts believe that Allergan could use a combination with Shire to defend itself from Valeant’s takeover attempts.
Today’s report about Allergan’s interest in Shire coincides with Valeant’s announcement that it has commenced an exchange offer for the Botox maker’s common stock.
“Hostile is not our preferred approach,” Valeant Chief Executive Officer Mike Pearson told Reuters yesterday. “But this deal was so strategic and financially compelling that it really makes sense.”
**As of 15:13 BST, buy Shire shares at 3814.00p.**
**As of 15:13 BST, sell Shire shares at 3813.00p.**