AbbVie justifies its position regarding Shire offer

US drugmaker AbbVie (NYSE: ABBV) has set out its ‘strategic rationale’ for its proposal to buy Ireland headquartered Shire (LSE: SHP) for around £27.3 billion ($46.5 billion).

The proposal represented an indicative value of £46.26 on May 29, while this cash and share mix is valued at £45.64 per share as of June 24 any offer made by AbbVie will need to be equivalent to £46.26 per share. The company said the combination has compelling strategic rationale for all shareholders, including that a merger would “potentially accelerate growth and profitability by leveraging AbbVie’s capabilities and infrastructure to make Shire’s pipeline and products more successful than its standalone prospects.” It added that AbbVie believes that Shire’s platform has a strong complementary fit with AbbVie’s existing specialty focus, including physician access relationships, regulatory and market access capabilities, and patient-centric focus. AbbVie’s existing expertise and development capabilities across areas such as GI, neuroscience, rare oncology indications, combined with AbbVie’s resources and scale, could develop global franchises from Shire’s platform and utilize M&A to supplement organic growth. In addition, AbbVie said that its global infrastructure could help Shire, along with its substantial combined financial capacity.

Proposal rationale