Shire shares rise as it unilaterally announces Takeda's sweetened deal

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Shire plc, a biotechnology company, focused on serving people with rare diseases and other specialized conditions worldwide.The firm is valued at $48.78 billion.

Vitamins made by Shire are displayed at a chemist's in northwest London, Britain July 11.

Since then, the Japanese firm made two more offers, which were rejected by Shire until the newly revised proposal made on 24 April.

"While this offer represents a solid improvement over Takeda's third bid (38 percent cash), we still wonder if it is enough to satisfy Shire shareholders", said Jefferies analyst David Steinberg.

The deadline to confirm the offer has been extended from today to 8 May. Kepler Capital Markets reaffirmed a "buy" rating and set a GBX 4,600 ($64.16) target price on shares of Shire in a research note on Thursday, February 15th.

As per the revised proposal, Takeda offers to pay almost £49 per each share of Shire in the form of £21.75 in cash and £27.26 in new Takeda shares.

Takeda investors, however, reacted badly to the increased bid, which is up from the £42.9 billion ($60 billion) the company offered previously.

Under the revised offer, Shire shareholders would also be entitled to any dividends declared by Shire prior to completion of the possible deal. A Takeda-Shire transaction would be by far the biggest.

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Takeda bought United States biotech Ariad Pharma for $4.7billion a year ago, although many market commentators felt this was overpriced.

There has been a recent flurry of merger and acquisition activity in the pharmaceutical industry, at a time when traditional players are seeing profits eroded by competition from generic medicine.

"I fully understand the first impression was negative", he told AFP.

But he said Shire offered an attractive portfolio. "Their profitability is high".

All the proposals consisted of a mix of cash and Takeda shares. "It may look expensive short-term, but it will bring good benefits over the longer term".

This isn't the first M&A bid for Shire - a $52 billion takeover by AbbVie had been agreed but was terminated in 2014 because of a change in USA tax rules.

But it has been under pressure in the past 12 months due to greater competition from generic drugs and debt from its $32 billion acquisition of Baxalta in 2016, a widely criticised deal.

Shire also announced last week it was selling its oncology business to unlisted French drugmaker Servier for $2.4 billion.

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