Reports: Takeda CEO Discusses Potential Shire Deal in Closed-Door Meeting With Analysts

Published: Apr 06, 2018 By

Takeda

Shares of Shire Plc spiked overnight after increased rumors that Japanese pharma giant Takeda could be closer to making a deal to acquire the rare disease company.

As BioSpace reported last week, Takeda is eying to acquire Shire in order to strengthen its drug portfolios in oncology, gastrointestinal and neurology disorders. In a Thursday discussion with Takeda Chief Executive Christophe Weber highlighted the merits of a deal with Shire, Reuters reported this morning. Weber’s comments sent shares of Shire up about 4 percent.

While the meeting was closed to media, some analysts told Reuters on condition of anonymity that Weber shared his company’s strategic case for acquiring Shire and also addressed concerns about the financial scope of such an acquisition. Reuters reported that Weber valued Shire at $48 billion, about $9 billion more than Takeda. During the talk, Weber reportedly dismissed an idea of acquiring part of Shire. He said the company was “weighing a deal for all of Shire Plc,” Reuters reported.

Bernstein analyst Wimal Kapadia told clients that based on the conversation Weber had with analysts that Takeda is willing to push its debt higher. That means the potential for a deal is more likely than not, Kapadia told clients in a note, FiercePharma reported. It was unclear if Kapadia was one of the analysts in the meeting with Weber or if he was operating off of confidential information from someone there.

For its part, Takeda has already publicly stated why an acquisition of Shire would be a good thing. The company said it would advance its Vision 2025 strategy by buttressing its three core therapeutic areas. In addition to the addition of Shire’s rare disease programs, Takeda said Shire would “enhance” the company’s robust R&D strategy. Although Weber reportedly continued to lay out reasons for why a Shire acquisition would be beneficial to Takeda, a company spokesperson told Reuters that nothing new had been disclosed in Thursday’s meeting.

Shares of Shire have remained down since the company’s acquisition of Baxalta in 2016. Investors would likely want to see an offer from Takeda in the range of $165 to $190 per share, Reuters said. An unnamed “top-30 investor” told Reuters that the market has not been happy with the company nor the strategic decisions of Flemming Ornskov, Shire’s chief executive officer.

“A lot of shareholders would probably think if you get a credible bid for the business then ‘thank God’, and we can move on,” the unnamed investor added.

Takeda has until April 25 to make a decision to acquire Shire under U.K. law.

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