This story was updated at 2:45 p.m. ET.

Shares of Valeant Pharmaceuticals International Inc. were up 7 percent at $29 on the New York Stock Exchange Friday following news the company received a joint takeover offer from Japan’s Takeda Pharmaceutical Co. Ltd. and TPG Capital Management LP this spring.

The Canadian drugmaker rejected the offer, according to a source familiar with the matter. The offer was made a few weeks before Joseph Papa took over as Valeant’s chief executive last week, the source told Reuters.

The board wants to give Papa time to focus on running the company before thinking about a sale offer, the source said.

Takeda and private equity firm TPG were ready to offer a substantial premium to Valeant, whose stock had fallen about 65 percent this year up to the close of trade on April 22 as the drugmaker was not just seeking a new head but was also hit by an accounting scandal, the source added.

However, analysts from Mizuho Securities USA said large shareholders and board members are so far "underwater" on their positions and would not want to part with the stock even at a premium to current levels.

“It would require a hostile offer and protracted battle to dislodge the current board, which most activists may find unattractive,” Irina Koffler, an analyst from Mizuho, said in a note late Thursday.

The brokerage, which reiterated its "underperform" rating on Valeant, also said the company’s assets do not warrant a premium bid at this time.

TPG and Valeant declined to comment. Takeda did not immediately respond to a request for comment.

There are currently no talks among the three companies following the bid’s rejection, according to the Wall Street Journal, which first reported the news late Thursday and also added that as part of the approach Takeda would take the business of Salix Pharmaceuticals and TPG would take much of the rest.

Data from Reuters were used to report this story.