Shire PLC (NASDAQ: SHPG) shares rose by 2.53 percent on Tuesday after it received a revised proposal from Takeda on Monday regarding a possible takeover attempt. Shire’s board said it is considering its position.
The newest revised proposal marks Takeda’s fourth attempt to acquire Shire. The two companies have engaged in multiple talks, in which Shire rejected saying that Takeda undervalued the company.
Under the U.K. Panel’s regulation, Takeda must offer a final offer or abandon its takeover attempt by Wednesday, meaning this revised offer could be Takeda’s last.
Although, there is a possibility the two companies may seek for an extension, but the deal may also fall through completely, according to Bloomberg, citing unnamed sources.
Shire rejected Takeda’s highest offer last week of nearly $60 billion, which is concerning. Takeda’s market capital was just under $40 billion Monday, meaning the pharmaceutical company would have to pull loans to finance the deal. Analysts project that Takeda will tap short-term bank loans before moving to longer term funds via bond sales or other options.
If Takeda moves through with the acquisition attempt and ends up pulling loans, the company will most likely face debt and ultimately hurt the company. S&P Global Ratings said this acquisition could hurt Takeda’s credit score.
Takeda has been aggressively pushing for the acquisition of Shire to expand its pipeline. The combination of the two would bolster Takeda’s drugs for cancer, gastrointestinal diseases and neuroscience field.
Takeda will also expand its business out of Japan and onto a global scale. The pharmaceutical company will gain significant presence in the U.S. and Shire’s origin, in the U.K.