Besides GlaxoSmithkline (LON:GSK) becoming more keen at this level, around 78p, the weak share price has attracted more M&A interest for Vectura (LON:VEC).
Previously it appeared 200p a share would be required to take over Vectura against competition from the likes of Johnson & Johnson (NYSE:JNJ), Pfizer (NYSE:PFE) and Bristol Meyers (NYSE:BMY). On the smaller side Arena Pharmaceuticals (NASDAQ:ARNA) may want to gatecrash the party.
The fundamental buy argument here which the potential bidders are backing is the way that Vectura is cash rich, debt free, and with potential consisting of the group’s technology and drugs pipeline.
The strategic interest for GSK’s competitors is that they would not wish the UK giant to get a sector edge over them via Vectura.
Given that this is relatively small company around £500m – even a 100% premium is only pocket change for one of the multinationals. The implication is that £1.50 may now be the price than is too good an offer for Vectura shareholders to resist.
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