Shire Says It Will Recommend $64 Billion Revised Bid From Takeda

• April 24 2018
• Jeff Sutherland

Shire Plc said it is willing to recommend a revised proposal from Takeda Pharmaceutical Co. as the companies neared a deal valued at about $64 billion.

Takeda Pharmaceutical Co. slumped the most in almost five years after the Japanese company increased its bid for Shire Plc to about 46 billion pounds ($64 billion), as the drugmakers sought more time to agree on a deal.

Takeda’s shares tumbled as much as 9.3 percent in early Tokyo trading even after Shire’s board said in a statement it’s willing to recommend to shareholders Takeda’s fifth proposal. Shire also agreed to extend a deadline required under U.K. takeover rules to May 8 for the companies to continue talks. Takeda confirmed the proposal in a separate statement.

The Japanese company is offering the equivalent of 49 pounds ($68.55) a share, including 27.26 pounds in stock and 21.75 pounds in cash, Shire said in the statement. That’s a 60 percent premium to Shire’s closing price on March 27, before Takeda disclosed its interest in the U.S. drugmaker.

A completed deal would be the biggest by a Japanese company of an overseas target, and launch the two companies into the top ranks of global pharmaceutical giants. Takeda has been ramping up its takeover ambitions as Chief Executive Officer Christophe Weber faces challenges in ensuring the future of Japan’s biggest drugmaker.

With few late-stage experimental drugs in its own pipeline and a shrinking home market, Takeda needs lucrative new therapies. A Shire takeover would bring Takeda medicines for rare diseases such as hemophilia -- a field that’s luring a growing number of drugmakers who can charge more for unique life-saving drugs than for routine treatment.

Takeda last week raised its offer to 47 pounds a share and lifted the cash portion of the bid after three prior proposals were rejected.