Takeda on track to close US$ 62 billion Shire deal, says CEO

By PharmaCompass

2018-11-15

Impressions: 137 Article

Last week, Christophe Weber, President and CEO of Japan’s Takeda Pharmaceutical, said he was confident of securing investor backing for the company’s US$ 62 billion acquisition of London-listed Shire, despite fears expressed by some shareholders about the concomitant debt burden.

In May this year, Takeda had struck a deal to take over Shire. The deal will propel Takeda into the top 10 rankings of global drugmakers, in terms of sales. With a market value of around US$ 32 billion, Takeda has secured a US$ 30.9 billion bridge loan to help finance the Shire acquisition. As a result, some investors were concerned over how well it will cope with debt repayments.

“We are quite satisfied with our current progress at Takeda. Our business is doing well,” he said at a conference. Weber was buoyed by strong quarterly results of Takeda, as well as strong demand for its existing products. He insisted that acquiring rare diseases specialist Shire was not a defensive move.

Takeda needs two-thirds support from its shareholders in order to close the deal. The company has scheduled a shareholder meeting for December 5 for investors to vote on the takeover.

The acquisition of Shire will increase Takeda’s exposure to the world’s largest drug market — the United States. Takeda has gained approval for what would be the biggest-ever overseas acquisition by a Japanese company from regulators in US, Japan and China. However, it is awaiting an okay from European authorities.

Meanwhile, Takeda’s Shire takeover is set to bring in a US$ 963 million fee bonanza for banks, law firms and other advisers in the form of fee.

Takeda expects to spend around US$ 733.4 million in fees and expenses, while Shire’s costs will range between US$ 216.5 million and US$ 229.5 million,

Takeda’s team of advisers includes investment banks Evercore, JP Morgan and Nomura while Shire’s line-up includes Citigroup, Goldman Sachs and Morgan Stanley.

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