Drugmaker Shire to Support Latest Offer From Takeda -- WSJ

Japan's Takeda submits fifth takeover proposal for rare-disease specialist Shire

By Preetika Rana and Noemie Bisserbe

This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (April 25, 2018).

Takeda Pharmaceutical Co. on Tuesday made a fifth takeover proposal for rival drugmaker Shire PLC, a last-ditch move by the Japanese company that would likely value the rare-drug specialist at more than $60 billion.

In separate statements Tuesday, neither company disclosed the financial terms of the proposal. Shire said it was considering its position.

Takeda last week proposed to buy Shire at GBP47 ($65.51) a share, valuing the Dublin-based company at $60.3 billion and its fourth attempt to acquire its European rival. Shire said it had rejected Takeda's three previous proposals because they undervalued its business. Takeda's interest in Shire first surfaced in March.

Under U.K. rules, Takeda has until Wednesday to formalize an offer, withdraw it or walk away. Both companies said there was no certainty a formal offer would be made.

A successful bid for Shire would mark the biggest-ever Japanese acquisition of a Western firm and create a global drug giant with sales of around $30 billion a year.

The combined entity would also bolster Chief Executive Christophe Weber's ambitions to expand Takeda's international footprint and add new drugs to the 237-year-old company's shrinking pool of patent-protected products.

Actos, Takeda's blockbuster diabetes drug, lost patent protection in 2012. Acid reflux medication Dexilant is expected to lose protection in 2020.

Best-known in the U.S. for its attention deficit hyperactivity disorder drug, Adderall, Shire has more recently transformed itself into one of the world's biggest makers of orphan drugs, or treatments for rare diseases.

The company has drawn interest from other drugmakers. In 2014, Chief Executive Flemming Ornskov fought a proposed takeover by AbbVie Inc. Last week, Allergan said it was also considering a bid before ultimately deciding against it.

Takeda, however, will likely have to take on significant debt to fund a deal. At roughly $50 billion, Shire's market value exceeds that of Takeda by more than $10 billion.

"I can only say they've got guts," said Tomoichiro Kubota, a senior market analyst at Tokyo-based Matsui Securities. Takeda shares fell 1.5% on Tuesday and have dropped more than 12% since its interest in Shire became public late March.

Shire shares were up 3.5% on Tuesday afternoon. The stock has risen around 30% since reports of Takeda's interest first materialized. Takeda's proposal last week valued Shire shares at a premium of more than 50% compared with when its interest became public.

--Kosaku Narioka and Peter Landers contributed to this article.

Write to Preetika Rana at preetika.rana@wsj.com and Noemie Bisserbe at noemie.bisserbe@wsj.com

(END) Dow Jones Newswires

April 25, 2018 02:47 ET (06:47 GMT)

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