Shire (NSDQ:SHPG) said late yesterday it agreed to Takeda Pharmaceutical‘s (TYO:4502) reworked acquisition bid, now worth approximately $64.2 billion (GBP £46 billion).
The takeover offer will now go to Shire’s shareholders for approval, having received backing from Dublin, Ireland-based Shire’s board of directors, according to a press release.
In the deal, Takeda will offer approximately 0.839 new Takeda shares and $30.33 for each Shire ordinary share, equaling out to approximately $68.33 (GBP £49) per share. Shire shareholders would also be entitled to dividends announced, declared, made or paid by Shire, according to the release.
Upon closure of the deal, Shire shareholders will hold approximately 50% of the newly formed Takeda. The deal will still be reliant on a due diligence review from Takeda and approval by both boards, according to Shire’s release.
The acquisition, if completed, will mark the largest overseas acquisition ever by a Japanese company, according to a Boston Globe report.
The approved proposal was the fifth from Takeda since late March, improving upon its previously rejected offer of approximately $60 billion. Early yesterday, reports came in that Takeda had sweetened its $60 billion deal, which seems to have come to fruition today.
Last week, Allergan (NYSE:AGN) flip-flopped on its interest in Shire, announcing that it was considering an acquisition and quickly following it up with an announcement that it does not intend to consider any such offers in the future.
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Japanese acquisition means Japan’s credibility expands its frontiers. On the riskier side, the conventional and more expensive brands from the US and Europe will feel a crunch once Japan’s Takeda hits the shelves.
Since pharmaceutical and medical devices industries are limited and restrained in marketing, competition has an addition. But since pharmaceutical runs in billions, the slice of the share by Takeda will not be felt much.
In effect, the champions of the industry will move their product, perhaps 10X times more, while mobilising their sales reps around the markets, perhaps more fiercely.
Medical devices and instruments industry will not feel the impact for the next 2-3 years, if only, Takeda has a separate plan. Surgical equipments again is a varied and pretty deeply diversified, Markets like UK and Europe rely on their local or imported Medical surgical equipment.
Speaking of exporting medical devices, health-care instruments for one-time use only are so frequently circulating from the manufacturers to the destination, like Najeh.biz does, the profit circulation is pretty fast and its covered.
Such acquisitions take time to immerse their claws in overseas markets – they do take time but whence they enter, the competition is already on solid footings. This is the side Japanese, if they export, will make them lose. The sales reps at Shire will have to be mobilised even before this news was out.
As per my opinion and management decision, I would’ve floated marketing strategy well 4 months befofe this news was to hit the market.
Just my 2 cents.