Takeda to vote on $62bn Shire acquisition, looming debt a factor

13-Nov-2018 - Last updated on 12-Aug-2019 at 16:59 GMT

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Takeda Pharmaceutical will hold an investor vote next month on the $62bn acquisition of rare disease specialist, Shire.

Debt burden is a concern for Takeda, as the company is reliant on a $30.9bn (€27.5bn) bridge loan to finance the acquisition. The deal needs support from two-thirds of its shareholders.

The vote is set to take place next month, according to Takeda, on December 5 at an extraordinary general meeting (EGM). Takeda had said previously that this EGM would be held in 2019, but the earlier date means a decision will arrive sooner rather than later.

In May of 2018, Takeda agreed to buy Shire with a bid of 46% cash and 54% stock. Therefore, Shire shareholders would own around half of the merged company. The deal reached this level after Shire initially rejected Takeda’s proposal, believing it had undervalued the company.

The acquisition will see Takeda become the only pharmaceutical company listed on both the Tokyo Stock Exchange in Japan and the New York Stock Exchange in the US. Should the acquisition go through, Takeda expects recurring pre-tax cost synergies for the combined group to reach at least $1.4bn annually.

European regulators have yet to approve this transaction. Per the acquisition, Takeda has proposed divesting Shire’s drug SHP647 in an aim to address any European concerns regarding overlap in inflammatory bowel disease drug development.

Regulators in the US, Japan, China, and Brazil have already approved this acquisition.

London-listed Shire’s shares rose 3% recently, hitting the highest share level since Takeda first announced its interest in acquiring the company.