Ashurst joins legal line-up as Japan's Takeda seals £46bn takeover of Shire

by Abel Hampton May 9, 2018, 1:14
Ashurst joins legal line-up as Japan's Takeda seals £46bn takeover of Shire

In a statement, Christophe Weber, president and chief executive officer of Takeda, said: "Shire's highly complementary product portfolio and pipeline, as well as experienced employees, will accelerate our transformation for a stronger Takeda." . The deal, which still needs approval from shareholders, would take effect in the first half of 2019.

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.

Takeda has been conducting due diligence for the past two weeks, but Shire had rejected its offer four times on price disagreement and also because it wanted more in cash and less in stock.

A fair share of industry watchers initially expected that Takeda wouldn't make it to the finish line since snapping up Shire would mean taking on a hefty debt load.

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). Takeda's existing shareholders are facing a hard time as their stake will be reduced to half.

Takeda said the transaction will bring in savings of about $600 million in duplicated research and development costs.

Only Sanofi Genzyme, the rare-disease unit of the French drug giant Sanofi, is bigger than Shire; it has about 5,000 employees, according to the Massachusetts Biotechnology Council. Within a short duration of five years, the Dublin-based company turned into a tenacious champion for patients in need.

"I am confident that this relentless focus will enable us to continue delivering against our priorities throughout this process".

In view of high buyout price, Takeda Pharma's shares have continuously slipped in the recent months. Shire's shares have soared 31 per cent, giving the company a market capitalisation of about US$50 billion. The agreement comes more than three years after United States drugmaker AbbVie scrapped its agreed takeover of the London-listed rare disease specialist, following a clampdown on tax inversion deals by the Obama administration.

Yet buying Shire is a stretch for the much smaller Takeda, which will borrow $30.85 billion from J.P. Morgan Chase, Sumitomo Mitsui, MUFG Bank and others to fund the takeover.

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