Takeda Pharmaceutical proposes $62bn acquisition of Shire to expand rare disease capabilities

Takeda Pharmaceutical, a major Japanese pharmaceutical company, has made a $62 billion offer to acquire Shire, an Ireland-based leader in rare disease treatments. This proposal, Takeda’s fourth attempt to purchase Shire, comes after Shire had previously rejected three offers, citing undervaluation of its business and future growth prospects.

Escalation in Acquisition Offers

The latest bid from Takeda represents a nearly 7% increase over the initial proposal made on March 29, highlighting Takeda’s determination to secure this acquisition. Under the new terms, Takeda has offered £47 per share, consisting of £21 in cash and £26 in new Takeda shares, making it a significant proposal in the pharmaceutical industry.

Strategic Implications of the Acquisition

This acquisition is viewed by Takeda as a strategic expansion into key therapeutic areas, including oncology, gastrointestinal, and neuroscience. Takeda believes that integrating Shire’s operations will significantly enhance its research and development capabilities and broaden its global market presence in the treatment of rare diseases.

Takeda’s Commitment to Shareholders

“Takeda believes that the improved proposal represents a highly compelling opportunity for Shire shareholders, which reflects a further increase in value and a material increase in the cash component of the consideration mix,” stated Takeda Pharmaceutical. They also highlighted that, upon completion, Shire shareholders would hold a substantial stake in a leading global biopharmaceutical company, benefiting from the expected synergies derived from the acquisition.

Previous Proposals and Strategic Moves

Prior to this proposal, Takeda’s last bid was £46.50 per share in a combined cash-and-stock deal. Despite Shire’s recent $2.4 billion agreement to sell its oncology business to French pharmaceutical company Servier, Takeda has maintained its offer, underlining its commitment to this strategic acquisition.

Future Prospects and Shareholder Impact

If accepted, the deal would result in Shire shareholders owning approximately 49% of the expanded company, which would be headquartered in Japan. This merger is positioned as a transformative move for both companies, promising significant advancements in the treatment of rare diseases globally.

Shire’s Board Response

In response to Takeda’s fourth offer, Shire stated, “The Board of Shire is considering its position with respect to the Fourth Proposal and will issue a further announcement in due course.”