Royalty Pharma, a privately-held firm that invests in pharmaceutical royalties, has put forward an informal bid for Irish-based Elan Corporation (NYSE:ELN). In the announcement, RP said it would offer $11 per share, which represents “the full value of Elan today,” Bloomberg reported.
The offer stands at a 6.3 percent premium over Elan’s closing price on February 15, and 3.8 percent over the closing price on February 22.
Earlier in the month, Elan sold its multiple sclerosis drug Tysabri for $3.25 billion. Elan management said it plans to use at least part of that money for acquisitions, something that, according to the New York Times, the company has limited experience with.
Royalty Pharma noted that a purchase of Elan might be more comfortable with shareholders, and that RP would be able to better help Elan navigate the “highly competitive” pharmaceutical market, the Times reports. Although Elan shares spiked following the announcement, analysts are speculating that Royalty Pharma may have to offer a larger bid to sway shareholders. Elan shares were up 7.64 percent as of 10:15 a.m. EST this morning.