Recently spun-out from Baxter, Baxalta is resisting the deal, saying it wants time to prove its true value

Irish speciality pharmaceutical firm has made a hostile takeover bid for fledgling US biopharmaceutical company Baxalta. The all-shares offer values Baxalta at around $30 billion (£19 billion). Baxalta rejected Shire’s initial private offer in July 2015, and the same outcome appears likely this time around.

Baxalta, which spun off from parent firm Baxter in July, said Shire’s offer ‘significantly undervalues’ the young company. ‘We are just in the initial stages of implementing our growth strategy as a standalone company and our stock has not yet achieved a price that reflects the company’s value and prospects,’ said Baxalta’s chief executive, Ludwig Hantson, in a letter to Shire chief Flemming Ornskov. Baxalta also rejected the idea that combining the two companies would be strategically complementary. 

Last year, American drug maker AbbVie abandoned a £32 billion planned merger with Shire, partly in reaction to US treasury rule changes designed to clamp down on ‘tax inversion’ deals in which American firms have merged with foreign rivals to avoid high US tax rates.