Takeda nearing preliminary agreement to buy Shire after sweetening offer

A blister pack containing Mezavant XL anti-inflammatory tablets, produced by Shire Plc, sits on a pharmacy counter in this arranged photograph in London, U.K., on Thursday, Dec. 29, 2016. Photographer: Chris Ratcliffe/Bloomberg

Takeda Pharmaceutical Co. is nearing a preliminary agreement to acquire Shire Plc after the Japanese drugmaker sweetened its roughly $60 billion bid for the biotechnology company, according to people with knowledge of the matter.

The two companies have been working on a tentative agreement on price and may announce a preliminary accord as early as Tuesday, the people said, declining to be identified as the discussions are confidential. Under U.K. takeover rules, Takeda must announce a firm offer or abandon its pursuit by Wednesday afternoon. The companies may seek an extension from authorities to finalize talks, the people said.

Discussions this week have revolved around an improved offer, including a possible increase in the cash component, the people said. The exact terms of the offer couldn’t be immediately learned. Talks may still be delayed or fall apart, they said. Representatives for Takeda and Shire declined to comment.

Shire shares surged as much as 6.2 percent in London, valuing the company at about 37 billion pounds ($52 billion). Takeda has declined about 24 percent this year, valuing the firm at about $35 billion.

Acquiring Shire would vault Takeda, which has few late-stage experimental drugs in its own pipeline, into the ranks of the world’s top pharmaceutical companies. The Japanese company last week raised its offer to 47 pounds a share and lifted the cash portion of the bid after three prior proposals were rejected.

Friday’s proposal included 21 pounds a share in cash and 26 pounds apiece in new stock for Shire, whose market value has soared since the takeover interest was disclosed last month.

Takeda has been ramping up its takeover ambitions under Chief Executive Officer Christophe Weber, seeking growth overseas amid patent expirations and a shrinking domestic population. A Shire takeover would be by far Takeda’s largest-ever deal and bring it medicines for rare diseases such as hemophilia — a field that’s luring a growing number of drugmakers who can charge more for unique life-saving drugs than for routine treatment.

Bloomberg

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.