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Takeda ups its offer for Shire

26 April, 2018, 12:32 | Author: Melinda Barton
  • Shire shares rise as it unilaterally announces Takeda's sweetened deal

The revised bid includes 21 pounds a share in cash and 26 pounds in new Takeda shares.

After multiple attempts, Takeda on Tuesday sweetened its offer for Shire. This is an increase of approximately 7% on the original offer and a premium of approximately 58% to Shire's closing share price of £29.81 on March 23, 2018, according to Takeda.

Peter Feldinger, who worked at Nycomed and Takeda before becoming a consultant, said the union of the two companies had stalled until Weber took charge.

Shire (LON:SHP) has reached a preliminary tie-up deal with Takeda Pharmaceutical, the group has said.

The preliminary deal comes after the rare disease specialist rejected the Japanese group's earlier approach which valued the company at about £42.4 billion.

This isn't the first M&A bid for Shire - a $52 billion takeover by AbbVie had been agreed but was terminated in 2014 because of a change in United States tax rules.

"Shire shareholders would give their right arms to be in Sky's position - two strong United States firms chasing it", Chris Beauchamp, a market analyst at IG, also commented.


"Shire shareholders would give their right arms to be in Sky's position - two strong United States firms chasing it". Shire markets over 40 products and that raked up $14.4 billion in 2017, up 8% from 2016.

On the other hand, if Takeda does buy Shire, it'll join the ranks of the world's largest drugmakers.

After a series of bids from the Japanese pharma, Shire's board has chose to accept a bid of £49 per share, meeting today's deadline under the United Kingdom takeover code when a bid had to be formalised. It announced an offer to acquire TiGenix NV, a Belgian maker of stem-cell therapies, for €520 million ($645 million) in January, as well as a $150 million initial payment to Denali Therapeutics Inc. for a partnership to develop drugs for neurodegenerative diseases. Changing policies and pricing pressures have prompted Japanese giants to look for growth overseas.

Shire is listed in London, but has its tax base in Ireland.

In UK stocks, GlaxoSmithKline shares dropped 50p to 1,412p after reporting a 15% drop in operating profit to £1.24 billion and warning investors that sales of a key respiratory drug in its portfolio were likely to slump. A cash component bump-up may be part of the new proposal, if recent analyst speculation proves correct. Investors in Takeda are also cautious. Convincing shareholders outside Asia to accept so much Japanese stock for a United Kingdom -listed company may also be a problem, as my colleague Chris Hughes has written.

A deal would significantly boost Takeda's position in gastrointestinal disorders, neuroscience, and rare diseases, including a blockbuster hemophilia franchise.

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