Shire shares soar as possible takeover tussle looms

Shire (Xetra: S7E.DE - news) has attracted further takeover interest as it continues to hold talks with a Japanese rival despite rejecting its advances three times.

The Dublin-based FTSE 100 biotech firm, which specialises in treatments for rare diseases and neuroscience products, said on Thursday that Takeda's £44bn cash and new shares proposal "significantly undervalued the company, its growth prospects and pipeline".

It later emerged that another competitor in the pharma field, best-known for being the maker of Botox, was ironing out its own position.

Allergan (Frankfurt: A1W5NE - news) , also based in the Irish capital, said its interest was in the "early stages".

Its statement read: "No offer has been made. There can be no certainty an offer will be made nor as to the terms on which any such offer would be made.

"A further announcement will be made as appropriate."

Shire shares closed the day almost 6% higher amid the prospect of a possible bidding war.

The fact Takeda and Shire are still talking leaves the Japanese firm in the driving seat as it seeks to expand its reach in the United States .

However, Takeda signalled it would not be willing to strike a deal at any price, saying it would remain "disciplined" in its approach.

Analysts were also more cautious.

There had been talk that Shire's decision this week to sell a valuable part of its business to a French firm in a £1.7bn deal might shake Takeda's resolve.

Jasper Lawler, head of research at London Capital Group, said: "Shire's latest refusal, as well a deal to offload its oncology division, a prize asset that would have been complimentary to Takeda's portfolio, could be the final nail in the coffin of the merger."