Fourth times the charm? Abbvie re-ups offer to buy Shire for £30bn

The previous three attempts by AbbVie to take over Ireland-based, but London-listed Shire were rebuffed by the company’s board of directors, which most recently turned down a £27.3bn ($46.8bn) bid in June after saying AbbVie undervalued the company and its potential.

Under UK rules, AbbVie has until July 18 to make a firm offer or walk away, though if it walks away, it cannot make another bid for as long as six months.

“AbbVie has made a compelling offer to Shire that creates immediate and long-term value to shareholders of both companies​,” AbbVie chairman and CEO Richard Gonzalez said. “We think its shareholders should strongly encourage the Shire board to engage in constructive dialogue with AbbVie​.”

Shire said its board will meet to consider the latest proposal and “a further announcement will be made in due course​.”

Deal Prospects​

If approved, the deal would bring Illinois-based AbbVie a new tax domicile in the UK, which would lower the company’s effective tax rate, and it would also come with Shire’s range of rare disease treatments and ADHD (attention deficit hyperactivity disorder) drugs, in addition to its two manufacturing facilities in Massachusetts.

The company has pumped $200m into its manufacturing infrastructure​, which is used to produce Vpriv, the company’s Type 1 Gaucher disease treatment, and its Fabry disease drug Replagal. One of the company’s sites in Lexington, MA, runs entirely on single-use and disposable technology, which the company claims is the only site in the world to do so. In February the site was cleared by the FDA to manufacture Vpriv.

Shire is also heavily reliant on third party contractors to manufacture other products and to provide goods and services. The company notes that some of its products or ingredients are only available from a single approved source for manufacture, which could make the company prone to disruptions if any of the contractors have issues.

But Shire spokeswoman Stephanie Fagan would not comment on how the deal would impact Shire’s supply chain or its manufacturing operations.

Likewise, AbbVie spokeswoman Adelle Infante said the company cannot address any manufacturing or supplier questions due to the UK Takeover Code.