Dublin-based Shire pharmaceutical company has come to an agreement with French firm Servier Laboratories to purchase its oncology business for $2.4 billion ((£1.68 billion). The deal comes before a potential takeover bid by Takeda of Japan could be realized.

Shire’s board gave the OK for the agreement, which is expected to be finalized by the second or third quarter this year. The deal does not need approval by shareholders.
The drug-making giant began its search for a buyer for its oncology wing last December, considering potential companies in Europe, the United States and in Japan. The company is considering an option to return the profits from the sale back to investors via a share buyback program when the current offer period expires. During this time Japanese firm Takeda could still launch a bid.

CEO of Shire, Flemming Ornskov said:

“This transaction is a key milestone for Shire, demonstrating the clear value embedded in our portfolio.

“While the oncology business has delivered high growth and profitability, we have concluded that it is not core to Shire’s longer-term strategy.

“We will continue to evaluate our portfolio for opportunities to unlock further value and sharpen our focus on rare disease leadership with selective disposals of non-strategic assets.

“We are confident that Servier will continue to invest in this business and our colleagues who are expected to transfer as part of the transaction in order to meet the needs of cancer patients globally.”