The deal will catapult Takeda to eighth rank among the top 10 in the global pharmaceutical industry.
The enlarged group will be a Japanese national champion in pharmaceuticals and a leader in gastroenterology, neuroscience, oncology, rare diseases and blood-derived therapies, used for serious conditions such as haemophilia. The company has secured $30.85 billion in bank financing to pay Shire shareholders the cash portion of the deal.
The final deal is about 46 percent cash and 54 percent stock, leaving Shire shareholders owning about half of the combined company. That's a 60 percent premium to the price before Takeda first said it wanted to take over Shire, on March 28.
The deal also increases Takeda's exposure to the United States, the world's biggest pharmaceutical market. Shire shares rose as much as 5.7 per cent early on Tuesday in London, while Takeda rose 4 per cent in Tokyo before the deal was announced.
Last month Shire revealed that it had plans to sell its oncology business to France-based pharmaceutical company Servier for $2.4 billion. Last year Weber bought US cancer specialist Ariad Pharmaceuticals for $5 billion.
Takeda said that it may reduce the combined workforce by 6 per cent to 7 per cent in the three years, post closing.
The two companies now have more than 50,000 employees between them worldwide and more than 5,000 in MA, making it potentially the biggest pharmaceutical employer in the state.
Takeda said the integrated company will be headquartered in Japan, listed in both Tokyo and NY, will expand its R&D presence in the Boston, US, area, and have major regional locations in Japan, Singapore, Switzerland and the US. And it intends to keep its investment-grade credit rating, targeting a debt-to-EBITDA ratio of 2x or less in a few years.
Shire's forte is rare diseases in fields such as blood and immunity, as well as nerve diseases. "That's where you could have some portfolio assessment and potentially some disposals", Weber said.
Shire was founded in the mid-1980s, selling calcium supplements above an off-licence in a village near Basingstoke. Since then, it has grown rapidly through acquisitions to generate revenues of about $15.2 billion past year.
Takeda was advised by Evercore, J.P. Morgan and Nomura, while Shire worked with Citi, Goldman Sachs and Morgan Stanley.