Shire’s long pursuit of Baxalta about to pay off – report

The pharmaceutical sector’s urge to merge endures.

Drugmaker Shire may be close to clinching a union with US-based Baxalta, perhaps as soon as this week, in a cash and stock deal valued at $32 billion, excluding debt, Bloomberg reported over the weekend, citing sources.

While final details are still being negotiated, the new offer by Shire could value Baxalta at $46.50-$48 per share, two sources told Bloomberg. An agreement would successfully end Shire’s six-month pursuit. Baxalta turned down an initial all-stock offer in July valued at $30.6 billion – based on Shire’s stock price at the time – as the offer excluded any cash payment. But in December Reuters reported that Shire’s deal makers had added enough cash to its previous bid for talks to advance.

It appears that they have.

The combined company would generate $20 billion in sales by 2020, according to Shire, which has focused its mergers and acquisitions firepower on companies that make rare-disease treatments. Shire bought Dyax for $5.9 billion in November and NPS Pharmaceuticals for $5 billion in February.

Deerfield, Illinois-based Baxalta – spun off from Baxter International in July – produces biotech treatments for rare blood conditions, cancers and immune-system disorders. It could enjoy a lower tax rate if it is taken over by Dublin-based Shire.

Irish companies pay taxes at a rate of about 12.5%, while the US, at almost 40% in some states, has some of the highest corporate taxes in any industrialised country.

This post is taken from news.markets: http://news.markets/shares/shires-long-pursuit-baxalta-pay-off-report-7549/