Takeda, Shire agree on $62 billion takeover deal

09 May, 2018, 01:19 | Author: Clarence Schmidt
  • Shire PLC

Takeda Pharmaceutical has reached an agreement to buy larger rival Shire Plc for about £46 billion pounds (US$62 billion) in a deal that will transform it into a top drug maker in the lucrative business of rare diseases and will boost its heft in the US.

Under the terms of the deal, Shire investors will receive $30.33 in cash and either 0.839 new Takeda shares or 1.678 Takeda ADSs for each share, the companies said.

Shire focuses its research on discovering therapies for rare diseases, although the Irish company is well-known for its attention deficit hyperactivity disorder drug Adderall.

The tie-up is one of the largest ever in the pharmaceuticals sector, crowning a hectic few months of deal-making as big drugmakers look to improve their pipelines by bringing in promising medicines developed by younger companies.

Shire's Chief Executive Officer, Flemming Ornskov is quite positive and enthusiastic about the deal.

Shire shareholders will own 50% of the enlarged group following the deal, which is expected to complete in the first half of 2019.

That is a 60 percent premium to the price before Takeda first declared its interest six weeks ago.


In its announcement Tuesday, Takeda noted that the combined company would have a significantly increased presence in the USA, the largest pharmaceuticals market in the world.

Shire's shares, which had been trading about 10 pounds below the value of Takeda's offer, traded 4 percent higher at just over 40 pounds, still well under the agreed price and indicating that shareholders still have reservations.

In a separate statement today, Takeda said it will continue to focus on growing its oncology portfolio, which along with its hematology holdings expanded previous year when Takeda acquired Ariad Pharmaceuticals for $5.2 billion.

The two companies now have more than 50,000 employees between them worldwide and more than 5,000 in MA, making it potentially the biggest pharmaceutical employer in the state. It will also have "major" regional locations in Japan, Singapore, Switzerland, and the U.S. Its net profit is about three times more than Takeda's. Acquiring the Shire will add another wing to the Takeda Pharma which is rare-disease treatments, or "orphan drugs".

There may, however, be opportunities to divest certain medicines falling outside these fields.

Takeda was advised by Evercore, J.P. Morgan and Nomura, while Shire worked with Citi, Goldman Sachs and Morgan Stanley.

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