Shire (LON:SHP) has reached a preliminary tie-up deal with Takeda Pharmaceutical, the group has said. The Japanese drugmaker’s sweetened offer comes after the rare disease specialist rejected earlier approaches.
Shire’s share price has been subdued in London in today’s session following yesterday’s rally, having given up 0.87 percent to 3,896.00p as of 10:04 BST. The stock is underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.51 percent lower at 7,387.66 points.
Takeda wins over Shire
Shire announced in a statement this morning that it had received a further revised proposal from Takeda Pharmaceutical, comprising 0.839 new Takeda shares and $30.33 in cash, equivalent to about £49 per share, and valuing the company at about £46 billion.
“The Board has indicated to Takeda that it would be willing to recommend the Revised Proposal to Shire shareholders subject to satisfactory resolution of the other terms of the possible offer,” Shire said in the statement.
The preliminary deal comes after the rare disease specialist rejected the Japanese group’s earlier approach which valued the company at about £42.4 billion. The tie-up will also come more than three years after US firm AbbVie scrapped its agreed takeover of the FTSE 100 group, following a clampdown on tax inversion deals by the Obama administration.
Analysts weigh in
“The deal seems to be much more of a merger,” Ronny Gal, an analyst with Sanford C. Bernstein & Co. in New York, wrote in a note to clients, as quoted by Bloomberg. The newswire further quoted Mitsushige Akino, an executive officer with Ichiyoshi Asset Management Co, as pointing out that the market was seeing this acquisition as negative, adding that it was ‘too big’ and ‘Takeda might not handle it’.