Japan's Sumitomo Pharma to buy rest of Myovant for $27 per share

(Reuters) -Japan's Sumitomo Pharma Co and a subsidiary said on Sunday they reached an agreement to purchase the remaining shares of Myovant Sciences, which had rejected a lower offer earlier this month.

Sumitomo and wholly owned unit Sumitovant Biopharma hold about 52 per cent of Myovant's outstanding stock and agreed to buy the rest for $27 per share, valuing the U.S drugmaker at about $2.59 billion, the companies said in a statement.

Myovant had rejected Sumitomo's previous proposal to acquire the remaining shares for $22.75 each, saying the bid significantly undervalued the company.

The new offer of $27 per share represents a premium of over 11 per cent to Myovant's last close.

Sumitomo Pharma in 2019 agreed to pay $3 billion for a 10 per cent stake in Swiss drugmaker Roivant Sciences Ltd and controlling interest in Myovant. The deal gave the Japanese company a drug pipeline for treatments of prostate cancer, urinary diseases, pediatric illnesses, and respiratory ailments.

Sumitomo's shares were up 0.2 per cent during Monday trading in Tokyo, versus a 0.6 per cent advance in the benchmark Nikkei average.