Published: Wed, May 09, 2018
Global Media | By Derrick Guzman

Japan's Takeda clinches £45.3 billion Shire deal as pharma M&A rolls on

Japan's Takeda clinches £45.3 billion Shire deal as pharma M&A rolls on

Takeda Pharmaceutical will pay $62 billion to acquire rare disease biotech Shire, securing on Tuesday a deal that will create one of the world's largest drugmakers by sales and transform the 237-year-old Japanese company.

The final deal is approximately 46 per cent cash and 54 per cent stock, leaving Shire shareholders owning around half of the combined group.

Christophe Weber, Takeda CEO, said: "Shire's highly complementary product portfolio and pipeline, as well as experienced employees, will accelerate our transformation for a stronger Takeda".

The Shire showed interest when Takeda gradually raised the bid and reached $66.17 (49 pounds) per share.

The deal also increases Takeda's exposure to the U.S., the world's biggest pharmaceutical market.

A few weeks ago, Takeda confirmed that it was trying to buy out Shire, a specialist in treating rare diseases, by noting that its most recent proposal had been spurned. A Shire takeover brings Takeda treatments for rare diseases such as haemophilia - a field that is luring a growing number of drug makers who can charge more for unique life-saving drugs than for routine treatments.

The price tag has alarmed investors in Takeda: Its shares are down 18% since it first revealed it was considering an approach for Shire in late March. Takeda Oncology is based in Cambridge, MA. Takeda also announced that the deal will cut R&D costs by about $600 million, with overall savings of $1.4 billion by the third year.

The Japanese company has a market value of just $33 billion, stoking fears about how much debt it will have to take on to fund the acquisition.

Post closing, the New Takeda Shares will be listed on the Tokyo Stock Exchange and the Local Japanese Stock Exchanges. Japan's Nishimura & Asahi and offshore firm Ogier also advised Takeda.

Shire has offered Takeda a large presence in the US and an expertise in the rare diseses.

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

The combined company will be headquartered in Japan, with an expanded presence in the USA -where Shire and Takeda both maintain significant R&D operations that have grown in recent years-and "major" regional locations in Japan and the US, as well as in Singapore and Switzerland.

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