Japan's Takeda Pharmaceutical has increased its offer for Shire to $47 a share after its three previous bids - the last at £46.50 - were rejected by the rare-disease drugs specialist. Shares edged up 1.4% mid-day Friday, leaving Shire's market cap at $48 billion - an indication that investors aren't at all convinced that a deal is certain.
Yesterday, a bidding war looked briefly like it could break out for Shire, which has rejected multiple bids from Takeda and was also confirmed to be in discussions with Allergan. It said Shire shareholders would own 51% of the merged company after the takeover.
Allergan has until 17 May to make a formal bid for Shire or bow out for six months under United Kingdom takeover rules for public companies, but after a fall in its own share price yesterday Allergan said it didn't intend to make a formal offer.
Takeda's new offer of £42.9 billion ($60 billion) is only a tad higher than its third approach, which, like two previous proposals, was rebuffed by Shire. Shares were flat on Friday.
Takeda said it wanted to work with Shire to agree a recommended deal and to allow an extension to an April 25 deadline imposed by the British regulator to make a firm offer.
Despite Allergan's swift U-turn, analysts believe further bids are likely as they say Shire's stock is undervalued relative to its earnings.
It would be Weber's boldest move by far, significantly boosting Takeda's position in rare diseases, including a blockbuster haemophilia franchise, gastrointestinal disorders and neuroscience, where Shire is a leader in ADHD drugs.
Based on Takeda's current market value, Shire shareholders would own approximately 49 percent of the enlarged company should the latest proposal be accepted.