Shire Confirms Talks With AbbVie - Update

(RTTNews) - Irish drug company Shire plc (SHPG), Friday confirmed having had discussions with rival AbbVie Inc (ABBV), but did not specify the nature of talks. The company said it would provide a further update when apt, and that there is no concrete deal with AbbVie or as to the terms of any offer.

Earlier in the day, Bloomberg said Shire held merger talks with AbbVie, citing people familiar with the matter and who requested confidentiality.

AbbVie has proposed to acquire Shire for about $51 billion. The offer wasn't made at one go, but only after three earlier offers by AbbVie were spurned by Shire. AbbVie made the latest offer on July 8, proposing to acquire Shire shares at 51.15 pounds each, or about 30.1 billion pounds ($51.5 billion).

North Chicago, Illinois-based AbbVie, which makes the blockbuster arthritis drug Humira, hopes the deal would enhance its product line and reduce the tax liability. The company would reincorporate in the UK after a merger with Shire as a means to cut taxes.

But Shire feels AbbVie's offers undervalues it. It is yet to formally respond to AbbVie's latest offer. Shire also feels a deal could impair its focus on drugs for rare diseases as well as slow down growth rates.

AbbVie was spun off from Abbott Laboratories (ABT) in 2013.

Shire stock closed Friday at $249.06, up $10.45 or 4.38%, on a volume of 4.8 million shares on the Nasdaq.

AbbView closed at $54.96, down $0.83 or 1.49%, on a volume of 13.6 million shares on the NYSE.