Japanese Takeda to acquire Shire for $62bn

Japanese Takeda to acquire Shire for $62bn

The Yomiuri ShimbunTakeda Pharmaceutical Co. has agreed with Irish major drugmaker Shire PLC to start procedures for making the Irish company a wholly owned subsidiary, the Japanese firm announced Tuesday.

Takeda and Shire shareholders will each own about half of the combined company. Shares in the company will be listed on the Tokyo Stock Exchange and the Local Japanese Stock Exchanges, with Takeda also set to apply for its American Depository Shares to be listed on the NYSE. According to MarketBeat, Shire now has a consensus "buy" rating and an average price target of 4,585.75p.

Takeda said the deal will save about $600m in duplicated research and development costs. Shire focuses on rare diseases, and the company's sale of its cancer business to Servier last month was viewed by some as a move to slim down in preparation of a merger.

Takeda's board members have approved the details of the acquisition plan that the company will formally propose to Shire, according to sources.

Shares in Takeda closed up 3.99 percent at 4,638 yen just before the announcement, which had been widely expected, while in London trade Shire was up 4.77 percent at £40.40. A Shire takeover brings Takeda treatments for rare diseases such as haemophilia - a field that's luring a growing number of drug makers that can charge more for unique life-saving drugs than for routine treatment.

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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.

"We firmly believe that this combination recognizes the strong growth potential of our leading products and innovative pipeline and is in the best interests of our shareholders, our patients and the communities we serve", Shire Chairman Susan Kilsby said in the statement.

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. The initial offer was $59.42 (44 pounds) per share which the Shire outright rejected terming it as undervaluation.

If he gets past that hurdle Weber will then need to knit together a new top 10 - by sales - global pharma company while carving out $1.4 billion in cost synergies. Takeda's largest previous purchase was a $13.7bn takeover of Nycomed in 2011. The deal, which still needs approval from shareholders, would take effect in the first half of 2019.

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