Myovant Sciences Ltd (NYSE: MYOV) opened nearly 35% up on Monday after the biopharmaceutical company said it rejected a buyout proposal from its largest shareholder.
Myovant is open to considering a better offer
Sumitovant Biopharma Ltd had sought to takeover the London-headquartered firm for $2.18 billion, as per the press release.
It was willing to pay $22.75 a share for the healthcare company – about a 27% premium on its previous close. Still, after evaluation, executives said the bid significantly undervalued Myovant Sciences.
They, however, confirmed that the company was open to considering a better offer should the shareholder choose to propose one. Sumitovant currently owns about 52% of the outstanding “MYOV” shares.
In its latest reported quarter, Myovant had a broader-than-expected 22 cents a share of loss. Its revenue, though, was ahead of expectations.
Myovant stock is now up more than 200% versus its year-to-date low.
Analyst shares her outlook on the Myovant stock
Myovant is working on developing treatments for endocrine diseases and focuses particularly on women’s health. Reacting to the stock market news, Roanna Ruiz (SVB Securities’ Analyst) said:
We think Sumitovant’s offer appears somewhat opportunistic and bullish investors may be able to argue that Myovant could sell for a premium to the initial $22.75 per share bid.
Recent approval from the U.S. FDA for Myfembree (endometriosis drug), the launch of Orgovyx (prostate cancer drug) a regulatory milestone payment worth $100 million from Pfizer, she added, puts Myovant in a position to secure a better proposal.
Ruiz reiterated her “outperform” rating on the Myovant stock even though it’s already at its 52-week high now.
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