If the deal gets shareholder approval, it will be the biggest international acquisition ever made by a Japanese firm.
If you thought all of the mega deals in pharma were done, then you need to think again. Japanese company Takeda Pharmaceutical recently announced that it has agreed to acquire Shire for $62 billion – after rejecting four previous offers. If the companies receive shareholder approval, the deal will put Takeda onto the list of the top ten drug manufacturers in the world.
The deal is the biggest one seen yet in the pharma industry. Other recent M&A transactions have involved the purchase of up-and-coming firms with new technologies by established big pharma companies looking to expand their portfolios.
It is also the biggest acquisition of a non-Japanese company by a Japanese firm. The last big purchase for Takeda was the acquisition of Nycomed for $14 billion in 2011. The company most recently acquired Ariad Pharmaceuticals for $5 billion.
Combined, Takeda and Shire will have strong positions in neuroscience, oncology, rare diseases and blood-derived therapies used for the treatment of hemophilia and similar diseases. To finance the deal, Takeda intends to eliminate thousands of jobs (6-7% of its 52,000-person workforce) and duplicate research efforts – many of which are in the US. Takeda estimates it will achieve annual cost synergies of at least $1.4 billion three years after completion. It is also possible that drug products that fall outside the core diseases areas may be sold.
To go forward, Takeda and Shire must get approval from 75% of Shire’s voting shareholders and two-thirds of Takeda’s shareholders. If received, the deal will close some time in the first half of 2019.