Shire has confirmed that it has rejected three cash-and-share takeover bids from AbbVie, the latter being worth about £27 billion.

Ireland-domiciled Shire said it had received “an unsolicited and highly conditional proposal”  which comprises £20.44 in cash and 0.7988 AbbVie shares. That deal represents a value of £46.11 per Shire share (44% cash/56% AbbVie shares), representing a 23% premium on its closing price on June 19.

Shire confirmed it had already turned down two earlier bids, after talks with AbbVie.  Following its meeting with the US firm, the board has decided unanimously to reject the proposal, saying it “fundamentally undervalued Shire and its prospects as a leader in rare diseases and specialty markets”.

The company argues that “new management has achieved a step-change in Shire’s performance, resulting in significantly accelerated growth and increased shareholder returns over the last 12 months”. It expects to more than double its 2013 annual product sales to $10 billion by 2020 and the AbbVie proposal would deny its shareholders of “the full benefits of Shire’s growth strategy”.

The board also had concerns regarding the “execution risks associated with the proposed inversion structure, as AbbVie would redomicile in the UK for tax purposes”. Chairman Susan Kilsby said that “our high-performing management team and focused strategy are producing even stronger results, reflected in our recent top-line growth and increased profitability”.

She added that “with an expanded portfolio focused on high-growth opportunities, an efficient cost base and an enhanced innovative pipeline, we have put in place a platform for long-term value creation.  We believe that Shire has a strong independent future”.

AbbVie confirmed that it made an approach to Shire and that discussions are no longer ongoing. The company said that “there can be no certainty that any firm offer will be made” so has not ruled out a fresh offer.

At 10am (UK time), Shire shares had shot up 11.9% to £41.82. The company is mentioned constantly in merger rumours and earlier this week there was speculation Allergan, which is itself fighting off a hostile offer from Valeant, was planning a bid.