Takeda Pharmaceuticals has moved in on the Swiss drugmaker Nycomed with a buyout offer worth as much as $14 billion, sources are saying. The negotiations are close to fruition, people close to the deal have told Bloomberg and other media, putting the two companies close to the biggest foreign buyout by a Japanese drugmaker.
Japan's drugmakers have been snapping up foreign companies in recent years, aiming to diversify beyond the Japanese market. Plus, the strong yen has made foreign deals cheap for the Japanese firms.
Buying Nycomed would give Takeda a greater reach in emerging countries, where prescription drug sales are growing faster than at home. The Swiss drugmaker has been pumping up its emerging-markets operations--to the point where sales in those regions account for almost 40 percent of its $4.5 billion in annual revenues. And Takeda needs new sources of growth; its big-selling stomach drug Prevacid has already gone off patent, and its Actos diabetes med faces big generic competition in August 2012, the Wall Street Journal reports.
"Takeda was slow to expand its business in emerging markets," Mizuho Securities analyst Hiroshi Tanaka told Bloomberg. "The deal would give Takeda a chance to diversify, and that would be valuable."
Nycomed is privately owned, with controlling interest held by Nordic Capital and Credit Suisse's private-equity unit. The company had been considering an IPO in Switzerland, but it abandoned those plans late last year, the WSJ says. Selling to Takeda would give Nycomed investors the opportunity to cash out without an IPO.