JAPAN’S largest drugmaker Takeda Pharmaceuticals was last night locked in talks with Swiss rival Nycomed as it tried to secure a $14bn (£8.6bn) deal in a desperate bid to diversify its revenues.
The deal, the second-largest ever foreign acquisition by a Japanese company, could be secured as soon as next week, according to sources close the negotiations, and would broaden its exposure to eastern Europe and provide access to Nycomed’s western European speciality pharmaceuticals distribution network.
Analysts expect the final price for privately-held Nycomed to reflect its growth potential in emerging markets. Nycomed had earnings before interest, tax, depreciation and amortisation last year of €774m or around $1.1bn, making a $14bn deal roughly 14 times its enterprise value to Ebitda.
“The suggested price looks high, but in the sector M&A is starting to happen and there are not enough companies to buy” Kepler Capital Market analyst Tero Weckroth said.
The deal, which comes just two months after an earthquake and tsunami devastated the country, demonstrates the buying power of the yen, which continues to hover at around 80 yen against the dollar and 114.5 yen against the euro, making foreign acquisitions relatively cheap.