Takeda, Shire reach agreement on buyout

Takeda Pharma offers $62 billion in takeover of Britain's Shire

Takeda Pharma offers $62 billion in takeover of Britain's Shire

The boards of both companies announced Tuesday morning that they had reached a deal after Takeda raised the amount of cash in the offer it made two weeks ago. Its agreed $62 billion takeover of much larger Shire Plc would push combined revenue above $31 billion as the Japanese firm seeks growth in new markets amid patent expirations and drug pricing pressures at home.

Susan Kilsby, chairwoman of Shire, said the takeover of her company - which is best known as the maker of Adderall, a treatment for ADHD, but has become one of the world's biggest makers of medicines for rare diseases - is in the best interest of shareholders.

The drug maker will be paying almost 49 pounds in cash and stock for each share of the Ireland based company, Shire, as per the closing shire price of Takeda on 23 April (the day before the preliminary deal was announced).

"That's part of the planning we need to do now", said Ramona Sequeira, president of Takeda's USA business unit. Shire's US headquarters is in Lexington, MA.

The CEO of Takeda, Christophe Weber cites that jointly with the Shire, a stronger Takeda will emerge.

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

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The total deal is consistent with Takeda's fifth proposal and values Dublin-based Shire at 49.01 pounds, or about $66.21, per share. Takeda shareholders will have to agree, though, and the deal hasn't been popular with investors so far. Takeda has revealed it expects pre-tax cost synergies to reach $1.4bn after three years, mostly stemming from the integration of redundant infrastructure within the two companies. He informed that the merger will retain about $600 million in replica research and development costs.

Shire's shares climbed more than three per cent in early trading.

Shire and Takeda have finally, officially, agreed on a deal.

In 2011 it took over Swiss rival Nycomed for 9.6 billion euros ($13.6 billion at the time). It is the largest takeover deal by a Japanese company. A year ago it bought Ariad Pharmaceuticals of Cambridge, Mass. Takeda is valued at about $34 billion.

Takeda's announcement comes amid a flurry of transactions in the pharmaceutical sector, marked by GlaxoSmithKline's agreement in March to buy out Novartis' stake in their consumer health joint venture. It will also have "major" regional locations in Japan, Singapore, Switzerland, and the U.S.

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