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Valeant soars on reports of a takeover bid

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Shares of Valeant Pharmaceuticals rose about 5.5 percent Friday following reports that the company rejected a joint takeover bid from Japan's Takeda Pharmaceutical and TPG Capital earlier this year, according to Reuters.

The stock traded at $28. 42 a share, extending Thursday's 6 percent after-hours gains. Valeant has lost nearly 90 percent of its value year over year, following scrutiny over its drug pricing and accounting practices.

The Canadian drugmaker rejected Takeda and TPG's offer two weeks before Joseph Papa took over as CEO in April, a source told Reuters. The same source said Valeant's board wanted to give Papa time to focus on running the company before considering a sales offer.

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Shares of Takeda also rose on the news, closing up nearly 3 percent. The company, along with private equity firm TPG were ready to offer a "substantial premium" for Valeant, Reuters reported.

The Wall Street Journal, who first reported the news, said there are currently no talks between the three companies following the bid's rejection.

Valeant and Takeda declined to comment on the report.

Valeant's stock is down more than 70 percent this year, while Federal prosecutors and Congress investigated the company's drug-pricing measures. The Securities and Exchange Commission is also looking into the company's accounting practices.