ZCZC
BCN-25
JAPAN-IRELAND-TAKEOVER-PHARMACEUTICAL-SHIRE-TAKEDA
Takeda shareholders agree to $60 bn Shire acquisition
TOKYO, Dec 5, 2018 (BSS/AFP) – Shareholders at Japanese drug giant Takeda
on Wednesday approved a plan to buy Irish pharmaceuticals firm Shire in a
deal worth around $60 billion, the biggest foreign takeover ever by a
Japanese firm.
A group of rebel investors, including members of the founding family, tried
to thwart the deal but were outvoted at an extraordinary shareholders’
meeting held in the western city of Osaka where the company has its
headquarters.
The scheme was “approved as originally proposed”, said a statement from
Takeda, adding it should come into effect in early January — pending
approval from Shire shareholders, who are to vote on the merger plan later
Wednesday in Dublin.
The deal, which will create one of the world’s top 10 drug companies, caps
a lengthy courtship by Takeda of its larger rival as it seeks to expand
overseas.
“We are delighted that our shareholders have given their strong support to
our acquisition of Shire,” said Takeda CEO Christophe Weber.
Analysts have said the buyout would be a smart move by Takeda as it looks
to diversify, and could pay off in the long-term, but it has also raised
concerns that the Japanese firm could be overextending itself financially.
Takeda plans to finance the 46-billion-pound ($58.4 billion) buyout through
issuing new shares in exchange for Shire stock, bank loans and bond issuance.
The buyout is the latest in a flurry of merger and acquisition activity in
the pharmaceutical industry as traditional players see profits eroded by
competition from generic medicines.
Japanese firms in particular are facing pressure domestically as the
government tries to cut prices of many branded drugs and increase the focus
on cheaper generics to curb health spending as the population ages rapidly.
Takeda, led by Frenchman Weber, has been actively looking overseas for
acquisitions.
In 2011 it took over Swiss rival Nycomed for 9.6 billion euros ($13.6
billion at the time).
Analysts have described Shire as an attractive target for Takeda, with a
portfolio of existing treatments in fields where the barriers to entry are
high and profits large.
In particular, Shire will give Takeda access to research and development in
fields the Japanese firm has long sought, including digestive systems, mental
illness and rare diseases.
The new firm would be “more competitive, agile, highly profitable, and
therefore more resilient… poised to deliver highly innovative medicines and
transformative care to patients around the world”, said Weber.
The deal is by far the largest acquisition of a foreign firm by a Japanese
company, dwarfing SoftBank Group’s 2016 acquisition of Britain’s ARM Holdings
in a $24.3 billion deal.
It falls well short, however, of breaking international records.
BSS/AFP/HR/1025