Shire share price: Pharmco mulls £12bn takeover of Swiss rival

London-listed rare disease specialist Shire (LON:SHP) is weighing a £12-billion bid for Switzerland-based rival Actelion (VTX:ATLN), The Sunday Times has revealed. The news underscores the deal frenzy which has gripped the pharmaceutical industry and has seen Shire snap up US rare disease group NPS Pharmaceuticals earlier this year.

Investors have reacted negatively to the news, with Shire’s share price having lost 2.29 percent to 5,330.00p as of 08:13 BST. The shares are underperforming the blue-chip FTSE 100 index which has inched into positive territory in early morning trading. Shire’s shares have gained just under 50 percent over the past year.
The Sunday Times yesterday quoted City sources as reporting that Shire had made an informal approach to Actelion several weeks ago, with the offer valuing the Swiss company at £12.4 billion, marking a 20-percent premium to its market value. Actelion, which specialises in rare diseases, reportedly rebuffed the proposal.
The approach follows Shire’s $5.2 billion (£3.4 billion) acquisition of US biotech group NPS Pharmaceuticals earlier this year. The Dublin-based group, whose tie-up with US pharma giant AbbVie (NYSE:ABBV) collapsed last October, has since made several acquisitions to strengthen its rare disease portfolio. Shire’s chief executive Flemming Ornskov has pledged to double the pharmco’s annual sales to $10 billion (£6 billion) by 2020 and has made no secret of his desire for further acquisitions.
Sources told the Sunday Times that Shire had been willing to pay 160 Swiss francs per share for the Swiss group. On Friday, Actelion’s closing price was about 132 Swiss francs. Shares in the company, however, have jumped more than six percent this morning and currently trade at 140.70 Swiss francs. The newspaper noted that both Shire and Actelion had declined to comment.
As of 09:03 BST, Monday, 08 June, Shire PLC share price is 5,310.00p.