Dublin-headquartered Shire, took to the January sales with the $1.5bn it received in a break-fee from US pharma giant AbbVie following the collapse of their proposed $55bn tie-up late last year, securing the acquisition of biotech firm NPS Pharma.
The company returned to Slaughter and May, which drafted the AbbVie break-fee due to the political climate around tax inversion deals, to advise on the purchase of biotech NPS for $5.2bn. The deal is Shire’s largest-ever acquisition and comes amid increased pressure to deliver shareholder value.
Slaughters corporate partner Martin Hattrell, who also advised, led on the purchase of the New Jersey-based drug maker. He said: ‘Much of the work was financing and it was primarily a US deal.’
That meant that Hattrell, who was assisted by finance partner Mark Dwyer, was reunited with Shire’s US advisers on the AbbVie deal: Davis Polk & Wardwell’s corporate partners Bill Chudd and George Bason. Skadden, Arps, Slate, Meagher & Flom M&A partners Eileen Nugent, based in New York, and Boston-based Graham Robinson represented NPS Pharma.
Shire secured an $850m short-term bank facility, which alongside cash and a pre-existing $2.1bn five-year revolving credit facility, will finance the transaction. In due course, the company plans to refinance the short-term bank facility through new debt issuances.
Shire’s chief executive, Flemming Ornskov, admitted that the company felt a ‘renewed urgency’ to improve shareholder value with AbbVie’s withdrawal leading to £8bn being wiped off the company’s value.
Hattrell said: ‘Shire has been a very active client in the last 12 months. The pharma sector is very busy at the moment and I expect that to continue.’
tom.moore@legalease.co.uk