Takeda's Shire takeover to bring US$963 million fee bonanza

Takeda's Shire takeover to bring US$963 million fee bonanza

Banks, law firms and other advisers stand to earn up to US$963 million in fees from Takeda Pharmaceutical's US$62 billion takeover of drugmaker Shire , according to documents for the deal published on Monday.

FILE PHOTO: The logo of Takeda Pharmaceutical Co. is displayed at the company's news conferenc
FILE PHOTO: The logo of Takeda Pharmaceutical Co. is displayed at the company's news conference venue in Tokyo, Japan May 9, 2018. REUTERS/Kim Kyung-Hoon/File Photo

LONDON: Banks, law firms and other advisers stand to earn up to US$963 million in fees from Takeda Pharmaceutical's US$62 billion takeover of drugmaker Shire , according to documents for the deal published on Monday.

The deal will be the largest-ever overseas acquisition by a Japanese company and will lead to big payments to advisers working on both sides of the transaction.

The Japanese company expects spend about US$733.4 million in fees and expenses in total, while London-listed Shire's costs will range between US$216.5 million and US$229.5 million, the companies disclosed in the documents.

Takeda’s team of advisers includes investment banks Evercore , JP Morgan and Nomura while Shire’s line-up includes Citigroup , Goldman Sachs and Morgan Stanley .

Takeda's single biggest expense will be its financing arrangements for the takeover which will cost it US$386.6 million. That financing package includes a bridge loan of almost US$31 billion from lenders including Sumitomo Mitsui Banking Corp and MUFG.

Takeda is also spending US$111.7 million on financial and corporate broking advice and US$44.2 million on lawyers, the documents show. Its other costs include US$24.3 million for accounting advice and US$6.3 million to public relations consultants.

Meanwhile, Shire estimates that it will pay banks as much as US$150 million for their advice during the takeover, and up to US$70 million to its lawyers.

Takeda still needs approval from European regulators and its investors for the deal to go ahead and said on Monday that it had scheduled a shareholder meeting for Dec. 5 for investors to vote on the takeover.

(Reporting by Ben Martin. Editing by Jane Merriman)

Source: Reuters

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