Shire ($SHPG) has offered up a new bid for elusive target Baxalta ($BXLT) that's more or less what the Illinois drugmaker has been looking for, reports say. But that doesn't mean Baxalta isn't exploring its other options.
The Baxter ($BAX) spinoff is checking out alternatives to its longtime suitor, the Financial Times reports, contacting other companies that may be interested in joining hands. While it hasn't fielded any other offers, it's trying to make sure it gets the best possible price, the newspaper notes.
The way analysts see it, potential partners could include Sanofi ($SNY) or AbbVie ($ABBV), which last year agreed to merge with Shire itself before new, stricter rules on tax inversions forced it to pull the plug. But Shire, based in tax-advantaged Ireland, has an leg up in its pursuit that could make it a tough opponent.
Baxalta reportedly likes its fallback option, too. Shire, once hesitant to fund its bid with cash for fear of upsetting the tax benefits conferred by Baxalta's July spinoff, now sees a way to include cash in its bid without triggering a hefty tax penalty.
|Shire CEO Flemming Ornskov|
And that cash has propelled talks between the two companies to the next level, Reuters says, which could make a buyout agreement a reality within the coming weeks. No matter what the terms, expect the deal to outvalue the $30 billion Baxalta shot down as a "lowball" offer this summer, one source told the news service.
If Shire can pull off a pact, no one will be happier than CEO Flemming Ornskov. With dreams of $20 billion in combined sales by 2020, the Shire skipper has been doggedly pursuing Baxalta for more than 6 months, Reuters reported in November.
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