Shire share price: AbbVie boss urges investors to engage in takeover talks
iNVEZZ.com, Thursday, July 3: The chief executive of AbbVie (NYSE:ABBV), the US drugmaker circling Shire (LON:SHP), has urged the Dublin-based company’s shareholders to press the board to engage in takeover talks, the Financial Times has reported.
Shire’s share price closed 0.78 percent higher at 4,545p in London yesterday.
**AbbVie’s CEO meets with Shire shareholders**
The FT yesterday quoted unnamed sources with knowledge of the matter as reporting that AbbVie’s chief executive Richard Gonzalez had returned to his company’s Chicago headquarters this week after telling large Shire shareholders that AbbVie would like to see the UK company’s books before it would consider sweetening its bid.
Gonzales flew to London earlier this week to try to convince Shire’s investors of the benefits of a merger between the two companies after the UK biopharma group snubbed three offers, the last one valuing the rare disease specialist at £46.11 per share, or £27 billion. (Shire share price: AbbVie boss to court shareholders in London)
One investor who met Gonzales told the FT that Shire would be reluctant to open its books to the US drugmaker in the absence of an increased offer because, under UK takeover rules, it would be obliged to do the same for any other interested parties.
Shire is seen as an attractive takeover target for US drugmakers on account of its Irish tax domicile. Reuters has quoted banking sources as suggesting that the Dublin-based group could also appeal to companies such as Bristol-Myers Squibb (NYSE:BMY) and Gilead Sciences (NASDAQ:GILD). Botox maker Allergan (NYSE:AGN) is also said to be interested in Shire as it tries to fend off a takeover approach by Valeant Pharmaceuticals (TSE:VRX). (Shire share price jumps again as analyst forecasts ‘imminent’ bid)
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The investor who met with AbbVie’s Gonzales told the FT that it was unclear whether the Chicago-based group was ruling out a higher bid or trying to manage market expectations and increase pressure on Shire.
Gonzales also reportedly told investors that the UK company’s 2020 revenue forecast was “too vague”. Shire set out its defence last month, promising to double its annual sales to $10 billion (£6 billion) by 2020. (Shire share price: Company takes leaf out of AstraZeneca’s playbook) Chief executive Flemming Ornskov expects Shire’s current products to generate $7 billion, with the balance to come from drugs in the company’s pipeline.
**Analysts on Shire**
As of June 27, the consensus forecast amongst 33 polled investment analysts covering Shire for the FT advises that the company will outperform the market.
Analyst Ratings Network reports that the FTSE 100 biopharma company currently has a consensus ‘buy’ rating and an average price target of 3,365.68p.
**On July 2, buy Shire shares at 4545.00p.**
**On July 2, sell Shire shares at 4544.00p.**