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Japanese Takeda to acquire Shire for $62bn

09 May 2018
Japanese Takeda to acquire Shire for $62bn

It's one of the biggest pharma deals in history, and the largest-ever global takeover by any Japanese company, at a value of $62 billion.

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.

The deal is part of Takeda's strategy of becoming a global pharmaceutical company.

Overall, it appears Takeda made five public bids for Shire.

The company has secured $30.85 billion in bank financing to pay Shire shareholders the cash portion of the deal.

As per the reports of the company on Tuesday, Takeda, a famous Japanese drug maker company has agreed to purchase Shire for $62.4 billion in both cash as well as stock.

Some analysts have suggested Takeda could sell off certain Shire businesses to make the deal more manageable but Weber said gastroenterology, neuroscience, oncology, rare diseases and blood products were all important areas to be retained.

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

In view of high buyout price, Takeda Pharma's shares have continuously slipped in the recent months. Buying Shire bolsters its offerings in gastroenterology and neuroscience, while adding a slate of rare disease drugs that include the Irish biotech's seven hemophilia medicines. That deal, Shire said today, is expected to close in the second quarter or third quarter, with the net proceeds meant to be used to repay debt.

Takeda has agreed that up to three Shire directors will join the company's board once the acquisition is completed.

Shire shareholders will own about half of the combined group after the deal, which will be the biggest in the sector since 2000 if approved by shareholders.

Enhancing Takeda's cash flow profile.

To pay off debts quickly, Takeda plans to slash thousands of jobs and cut back on duplicated drug research. Most of its employees are in the United States. "That's where you could have some portfolio assessment and potentially some disposals".

CNN notes, "The price tag has alarmed investors in Takeda: Its shares are down 18 percent since it first revealed it was considering an approach for Shire in late March".