Shire in fight to persuade investors about Takeda's £45bn takeover deal

Shire in fight to persuade investors about Takeda's £45bn takeover deal

Takeda's bid follows a series of worldwide acquisitions by the Japanese drug-maker as it seeks to make up for a slowing domestic market and take its place on the global stage among the largest pharma firms, including Pfizer. Takeda added that Shire's drug portfolio would benefit from greater exposure in Japan and emerging markets.

In late March, Takeda expressed an interest in acquiring Shire, although at that time no official bid had been made.

Shares in Shire, meanwhile, have soared about 30% since late March.

Takeda shareholders would own roughly 50% of the new company if the proposed deal wins approval.

Takeda's financial advisers included Evercore Inc., JPMorgan Chase & Co. and Nomura Holdings Inc., while Shire received financial advice from Citigroup Inc., Morgan Stanley and Goldman Sachs Group Inc. "However, the risk is that if shareholders vote this down then the shares are going to go down a lot", said Polar Capital fund manager Dan Mahony, who owns both Shire and Takeda stock. In addition, Takeda will apply for its ADSs (each representing 0.5 Takeda Shares) to be listed on the NYSE.

Takeda has however obtained a $31 billion bridge loan to help finance the deal, a fact that had unnerved some investors before the deal's announcement.

For the deal between Takeda and Shire to proceed, 75% of Shire's voting shareholders must support the transaction. Apart from the merits or demerits of the combination, Takeda's offer document estimates that the enlarged entity would attain $1.4 billion in annual pre-tax cost synergies three years after the transaction closes.

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The Japanese company announced plans to buy Shire in a cash and shares deal, a fortnight after the two sides reached a preliminary agreement that was subject to due diligence from both companies.

Takeda said that it may reduce the combined workforce by 6 per cent to 7 per cent in the three years, post closing.

Prior to his arrival, Takeda bought Nycomed for $14 billion in 2011 in its previous biggest deal.

Takeda will become the only pharma company with dual listings in Tokyo and NY. Takeda's research and development also includes vaccines.

"Shire's highly complementary product portfolio and pipeline, as well as experienced employees, will accelerate our transformation for a stronger Takeda", Christophe Weber, the Japanese firm's CEO, said in a news release. A Shire takeover brings Takeda treatments for rare diseases such as hemophilia - a field that's luring a growing number of drugmakers that can charge more for unique life-saving drugs than for routine treatment.

Founded in 1781 in Osaka, Japan, Takeda is a global, R&D-driven pharmaceutical with around 30,000 employees globally and operating in 70 countries and regions. Shire is based in Ireland and listed on the London Stock Exchange.

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