Takeda plunges after Shire yields to £46bn fifth bid

Drugs group Shire on Tuesday said it is prepared to back Takeda’s fifth offer for the business and has agreed more time to thrash out the details of the £46 billion deal.

However, Japanese investors are not yet won over and sent shares in Takeda 9% lower overnight.

Takeda’s shares plunged to their lowest point in five years, potentially making the acquisition even harder for the Japanese pharma company to pull off.

Investors in Japan are concerned that this deal, one of the biggest takeovers of a foreign firm by a Japanese company, could be too big for Takeda and might put too much pressure on its finances.

Takeda has now offered slightly more than half the £46 billion in new Takeda shares, which will be listed in New York and Tokyo. The two companies have agreed a new deadline of May 8 to complete discussions.

The Japanese company is offering the equivalent of £49 a share, which is a 60% premium to Shire’s closing price on March 27, before Takeda revealed its first approach.

Putting Takeda and Shire, the Irish maker of ADHD drug Adderall and a specialist in rare diseases treatments, together would create a global pharma giant, with close to £22 billion of annual sales. The new company would be similar in size to AstraZeneca.

The prospect of a bidding war for Shire can not be overruled. Irish rival Allergan said it was interested in making an offer last week, but did a u-turn hours later after a shareholder backlash.

The attraction of Shire for Takeda is the highly lucrative rare diseases market in the US, which is largely exempt from the usual pricing pressures seen in the wider pharmaceuticals market.