This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

The Deal: Shire to Spend $4.2 Billion on ViroPharma

Stocks in this article: VPHM

LONDON ( The Deal) -- Dublin's Shire on Monday, Nov. 11, unveiled an agreed $4.2 billion takeover offer for ViroPharma (VPHM) to expand its portfolio of rare disease treatments.
Shire said it would pay $50 per share for Exton, Penn.-based ViroPharma, 27% more than the target's Friday closing price and a 64% premium to its close Sept. 12, when speculation surfaced that it was reconsidering its future.
While many pharmaceutical companies are using their wallets to add innovative treatments for widespread maladies, Shire is hoping a focus on uncommon diseases will prove profitable. The biotech in August agreed to extend a discovery and development deal with Horsholm, Denmark-based Santaris Pharma, in which the two are looking for treatments for rare genetic disorders.
"The acquisition of ViroPharma will immediately benefit Shire and is entirely consistent with our clear strategic objective of strengthening our rare disease portfolio," said Shire CEO Flemming Omskov in a statement.
ViroPharma will allow Shire to broaden its portfolio of drugs focused on treating and preventing hereditary angiodema, which causes spontaneous swelling of the skin and mucous membranes. ViroPharma's Cinryze is used to prevent the attacks, while Shire's own Firazyr is used during attacks.
ViroPharma, whose sales jumped 24% in the third quarter to $113 million, also produces treatments for adults with adrenal insufficiency and to treat seizures in infants and adolescents. The company credited Cinryze for the sales jump and said it swung to net income of $4 million in the third quarter from a $5 million loss a year earlier.
Still, ViroPharma isn't immune to the generic competition that has many major pharmaceutical companies worried -- it had a loss of $59 million in the first nine months of the year, up from a loss of $10 million in the same period a year earlier, as generic competition hit its Vancocin treatment for gastrointestinal bugs.
The target in September reportedly tapped Goldman Sachs to review its options after it received an unsolicited approach, either from Shire or French giant Sanofi.
Shire said it would be able to save $150 million each year by combining the companies. It said the deal will be considered unconditional as soon as shareholders representing a simple majority commit their ViroPharma shares. The purchase will boost its own earnings immediately following completion, Shire added.
Lazard and Morgan Stanley are providing financial advice to Shire, with Davis Polk & Wardwell LLP its legal adviser. Skadden, Arps, Slate, Meagher & Flom LLP is legal adviser to ViroPharma.
Shire shares gained 3.7%, or 102 pence, to 2,898 pence ($46.40) in late morning London trading.

Written by Andrew Bulkeley

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,903.16 +98.36 0.55%
S&P 500 2,070.19 -0.46 -0.02%
NASDAQ 4,764.6990 -0.6810 -0.01%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs