NPS Pharmaceuticals, Inc.
Robbins Arroyo LLP: Acquisition of NPS Pharmaceuticals, Inc. (NPSP) by Shire PLC (SHP) May Not Be in Shareholders’ Best Interests
Robbins Arroyo LLP is investigating the proposed acquisition of NPS Pharmaceuticals, Inc. (NASDAQ: NPSP) by Shire plc (NASDAQ: SHPG, LSE: SHP). On January 12, 2015 , the companies announced the signing of a definitive merger agreement pursuant to which Shire will acquire NPS Pharmaceuticals. Under the terms of the agreement, NPS Pharmaceuticals shareholders will receive $46.00 for each share of NPS Pharmaceutical common stock.
Is the Proposed Acquisition Best for NPS Pharmaceuticals and Its Shareholders?
Robbins Arroyo LLP’s investigation focuses on whether the board of directors at NPS Pharmaceuticals is undertaking a fair process to obtain maximum value and adequately compensate its shareholders.
As an initial matter, the $46.00 merger consideration represents a premium of only 47.1% based on NPS Pharmaceuticals’ closing price on December 12, 2014. This premium is significantly below the average one-month premium of nearly 162% for comparable transactions within the past year. Further, the $46.00 merger consideration is significantly below the target price of $50.00 set by an analyst at Barclays on January 11, 2015, and the target price of $48.00 set by an analyst at CRT Capital Group on January 12, 2015.
On November 10, 2014, NPS Pharmaceuticals released its earnings results for its third quarter 2014, reporting strong quarterly earnings. Net sales were $28.1 million for the third quarter of 2014 compared to $11 million for the same period last year. Royalty revenues were $29.1 million for the third quarter of 2014 compared to $28.1 million for the same period last year. In commenting on these results, NPS Pharmaceuticals President and Chief Executive Officer Francois Nader touted the Company’s future business prospects due to the success of its products, namely Gattex/Revestive and Natpara. In particular, Nader stated that Gattex/Revestive “achieved $68 million of net sales so far this year leaving [the company] on track to deliver more than 200% year-over-year growth.” Moreover, Nader said that NPS Pharmaceuticals was “very gratified to receive a positive Advisory Committee vote recommending the approval of Natpara for the long-term treatment of hypoparathyroidism” and mentioned that the company was “advancing a number of pre-commercial activities to prepare for the successful launch of Natpara in the second quarter of 2015.”
In light of these facts, Robbins Arroyo LLP is examining NPS Pharmaceuticals 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.
NPS Pharmaceuticals 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.
NPS Pharmaceuticals 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.