Shire share price rallies as pharmco agrees £46bn deal with Takeda

Japan's Takeda announces £46 bn firm offer for Shire

Japan's Takeda announces £46 bn firm offer for Shire

Dr. Andrew Plump, Takeda's chief medical and scientific officer since 2015, said acquiring Shire will raise from three to 10 the number of late-stage clinical drugs that Takeda has in its pipeline.

Shire's shares were trading 4 percent up on the previous close at just over 40 pounds by 1230 GMT, still well below the agreed price and indicating that some uncertainty remains. The pharmco's shares have lost more than 12 percent of their value over the past year, as compared with about a 3.6-percent gain in the Footsie.

Takeda and Shire expect the transaction to close in the top half of 2019; upon completion, Takeda shareholders will own around 50 percent of the combined entity. Nikkei Asian Review says the formal bid now expected will amount to 46 billion pounds in cash and stock - about $64 billion - in line with the latest preliminary numbers offered by Takeda.

Takeda will pay $66.56 per Shire share: $30.33 in cash, with the rest in the form of 0.839 of a new Takeda share. According to MarketBeat, Shire now has a consensus "buy" rating and an average price target of 4,585.75p.

The acquisition will "strengthen Takeda's core therapeutic areas, bringing together complementary positions in gastroenterology and neuroscience, and provide leading positions in rare diseases and plasma-derived therapies", Takeda added.

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The deal should help Takeda pivot away from its home base to more lucrative markets like the USA and Europe, and add new drugs to its shrinking pool of patent-protected products.

Takeda, founded in Osaka in 1781, wants Shire, a specialist in the treatment of rare conditions, to help it expand globally - especially in the United States - as it faces down the prospect of weaker drug prices in its home market.

Shire, which is based in Dublin, was founded in...

Takeda will become the only pharma company with dual listings in Tokyo and NY. Last year, it purchased Ariad Pharmaceuticals, allowing them to further develop their oncology unit. Once complete, the merged firm will leapfrog AstraZeneca and Eli Lilly to become one of the largest pharmaceutical companies by sales. Last month it announced the sale of its oncology business to French drug maker Servier for $2.4 billion. Shire conditionally agreed to Takeda's fifth offer as the deadline approached, but managed to get an extension to today in order to thrash out other terms.

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