Robbins LLP: Acquisition of Baxalta, Inc. (BXLT) by Shire PLC (SHP) May Not Be in Shareholders’ Best Interests
Robbins LLP is investigating the proposed acquisition of Baxalta Inc. (NYSE: BXLT) by Shire PLC (London: SHP). On January 11, 2016, the two companies announced the signing of a definitive merger agreement pursuant to which Shire PLC will acquire Baxalta. Under the terms of the agreement, Baxalta shareholders will receive $18.00 in cash and 0.1482 Shire ADS per Baxalta share, the value of which implies a total current value of $45.57 for each share of Baxalta common stock.
Is the Proposed Acquisition Best for Baxalta and Its Shareholders?
Robbins LLP’s investigation focuses on whether the board of directors at Baxalta is undertaking a fair process to obtain maximum value and adequately compensate its shareholders.
As an initial matter, the $45.57 merger consideration represents a premium of only 43.1% based on Baxalta’s closing price on August 3, 2015. This premium is significantly below the average one week premium of nearly 170.04% for comparable transactions within the past five years. Further, the $45.57 merger consideration is significantly below the target price of $47.00 set by an analyst at UBS on October 29, 2015.
On October 29, 2015, Baxalta reported strong earnings results for its third quarter 2015. Net sales were nearly $1.6 billion for the recent quarter representing a 7.19% increase from the previous year. Net income was $309 million for this most recent quarter representing a 25.6% increase from the previous year. In commenting on these results, Baxalta CEO and President Ludwig Hanston remarked, “We are already delivering on our promise to patients and shareholders in the short time that we have been an independent, standalone company. Baxalta’s strong financial performance, increasing depth and breadth across the portfolio and meaningful pipeline achievements all validate our company’s compelling growth prospects, vision and commitment to driving shareholder value.”
In light of these facts, Robbins LLP is examining Baxalta’s board of directors’ decision to sell the company now rather than allow shareholders to continue to participate in the company’s continued success and future growth prospects.
Baxalta shareholders have the option to file a class action lawsuit to ensure the board of directors obtains the best possible price for shareholders and the disclosure of material information.
Baxalta shareholders interested in information about their rights and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003, or you can complete the form below and we will contact you directly.