Takeda to Divest its Japan Consumer Health Care Business Unit?to Blackstone for JPY 242.0 Billion
August 24, 2020
- Transaction further sharpens Takeda?s focus on five key business areas
- Consumer Health Care Business to continue serving consumers in Japan and Asia under new owner
Osaka, Japan, August 24, 2020 ??Takeda Pharmaceutical Company Limited (TSE:4502/NYSE:TAK) (?Takeda?) today announced that it has entered into an agreement to divest Takeda Consumer Healthcare Company Limited (?TCHC?), a wholly-owned subsidiary of Takeda focused on the consumer health care market primarily in Japan, to Oscar A-Co KK, a company controlled by funds managed by The Blackstone Group Inc. and its affiliates (collectively ?Blackstone?) for a total value of JPY 242.0 billion*. Blackstone is one of the world leading investment firms and has extensive investment experience in the health care sector. The transaction is expected to close by March 31, 2021, subject to customary legal and regulatory closing conditions.
The portfolio to be divested to Blackstone includes a variety of over-the-counter (?OTC?) medicines and health products that generated total revenues of over JPY 60 billion in fiscal year 2019. TCHC?s strong regional brands include Alinamin, its top selling product and Japan?s first vitamin B1 preparation, and Benza, a cold remedy. Blackstone intends to develop the business together with current TCHC management and continue to employ its employees.
Christophe Weber, Takeda President and Chief Executive Officer said, ?Today?s transaction will provide TCHC with the ownership, resources and strategic focus to continue to thrive and meet the needs of customers, while further sharpening Takeda?s strategic focus and commitment to financial discipline and transforming science into life-changing medicines. TCHC played an important role in Takeda?s long history, but with our growth strategy now focused on five key business areas ? Gastroenterology (GI), Rare Diseases, Plasma-Derived Therapies, Oncology and Neuroscience ? and an increasingly competitive consumer health care market in Japan, the ownership transition will benefit both TCHC and Takeda. We are confident that under Blackstone, TCHC will be well-positioned to continue growing and developing its product offerings in the years to come to address the evolving needs of consumers.?
Takeda, which started TCHC as a separate business in April 2017 to further develop the consumer health care business in Japan, is now focused on highly innovative medicines across its five key business areas and working to address significant unmet patient needs in these fields. Under Blackstone?s ownership, TCHC will benefit from increased strategic focus, resources and agility to support the growth and development of its important brands and to rapidly respond to evolving market conditions and diverse customer needs.
The sale of TCHC supports Takeda?s divestiture program which is focused on optimization of its portfolio to align with its global long-term growth strategy and provide uninterrupted access and supply of critical products to patients. So far in 2020, Takeda has also agreed to divest three different non-core asset portfolios in the Asia Pacific, Europe, and Latin America regions. In June, Takeda agreed to divest a portfolio of non-core assets sold exclusively in the Asia Pacific region to Celltrion for up to $278 million USD; in April, Takeda announced the sale of non-core products in Europe to Orifarm Group for up to approximately $670 million USD, including the sale of two manufacturing sites in Denmark and Poland; and in March, Takeda announced the sale of non-core products in Latin America to Hypera Pharma for $825 million USD, as well as completed the previously announced sales of non-core assets spanning the Russia-CIS region to STADA and in countries spanning the Near East, Middle East and Africa region to Acino.
For the transaction details of the sale of TCHC, please see the attachment below.
About Takeda Pharmaceutical Company Limited
Takeda Pharmaceutical Company Limited (TSE:4502/NYSE:TAK) is a global, values-based, R&D-driven biopharmaceutical leader headquartered in Japan, committed to bringing Better Health and a Brighter Future to patients by translating science into highly-innovative medicines. Takeda focuses its R&D efforts on four therapeutic areas: Oncology, Rare Diseases, Neuroscience, and Gastroenterology (GI). We also make targeted R&D investments in Plasma-Derived Therapies and Vaccines. We are focusing on developing highly innovative medicines that contribute to making a difference in people's lives by advancing the frontier of new treatment options and leveraging our enhanced collaborative R&D engine and capabilities to create a robust, modality-diverse pipeline. Our employees are committed to improving quality of life for patients and to working with our partners in health care in approximately 80 countries.
For more information, visit?https://www.takeda.com.
Contacts:
Japanese Media
Kazumi Kobayashi
Email:?kazumi.kobayashi@takeda.com
Tel: +81 (0) 3-3278-2095
Media outside Japan
Holly Campbell
Email:?holly.campbell@takeda.com
Tel: +1 480-213-8368
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Attachment
Transaction Details of Sale of Shareholding in TCHC to Blackstone
Takeda Pharmaceutical Company Limited (?Takeda?) today decided to transfer all shares of Takeda Consumer Healthcare Company Limited (?TCHC?), a wholly-owned subsidiary of Takeda, to Oscar A-Co KK (?SPC?), a company controlled by funds managed by The Blackstone Group Inc. and its affiliates (collectively ?Blackstone?), and entered into a share purchase agreement with SPC, as specified below. Following the transfer of shares, TCHC will be excluded from the scope of consolidation of Takeda.
* As a result of the share transfer, a wholly owned subsidiary of TCHC, Takeda Healthcare Products Company Limited (?THP?), will also be excluded from the scope of consolidation of Takeda.
* The transfer price is the total consideration including the transfer price for the intellectual property assignment agreement, simultaneously agreed with the share purchase agreement.
* The date of transfer of shares is scheduled on March 31, 2021, however, with a mutual agreement in writing between the parties, the date of transfer of shares can possibly be determined at another date.
*?Enterprise value. Actual transfer price will be determined after adjustment for items including net debt and working capital of TCHC and Takeda Healthcare Products Company Limited.
- Rationale for the share transfer
- Overview of TCHC to be transferred
(1) | Company name | Takeda Consumer Healthcare Company Limited | ||||
(2) | Location | Tekko Building 23F, 1-8-2 Marunouchi, Chiyoda-ku, Tokyo, Japan | ||||
(3) | Representative | Mari Nogami, Representative Director and President | ||||
(4) | Scope of business | Research & development, manufacturing, sales and marketing of over-the-counter products, quasi-drugs, etc. | ||||
(5) | Capital | 490 million yen | ||||
(6) | Date established | April 15, 2016 | ||||
(7) | Major shareholders and ratio of shares held | Takeda Pharmaceutical Company Limited 100% | ||||
(8) | Relationships with Takeda | Capital Relationship | Takeda owns 100% of shares in TCHC. | |||
Personnel Relationship | Three employees of Takeda concurrently serve as Chairman of the Board, Director, and Auditor at TCHC and other employees of Takeda are seconded to TCHC. | |||||
Business Relationship | Takeda and TCHC have business transactions including intellectual property agreements and a loan agreement. | |||||
(9) | Operating results and financial condition for the last three years (Non-consolidated basis under Japanese GAAP) | |||||
Accounting period (million yen) | Fiscal year ended March 31, 2018 | Fiscal year ended March 31, 2019 | Fiscal year ended March 31, 2020 | |||
Net assets | 10,720 | 11,191 | 10,262 | |||
Total assets | 32,490 | 27,791 | 34,037 | |||
Net assets per share | 54 | 56 | 51 | |||
Revenue | 79,921 | 64,139 | 60,897 | |||
Operating profit | 13,160 | 12,945 | 12,819 | |||
Ordinary profit | 13,215 | 13,252 | 12,966 | |||
Net profit | 8,828 | 9,624 | 8,654 | |||
Net profit per share | 44 | 48 | 43 | |||
Dividend per share | 44 | 48 | 43 |
- Overview of Oscar A-Co KK to the share transfer
(1) | Company name | Oscar A-Co KK | |
(2) | Location | Tokyo Kyodo Accounting Office, 3-1-1 Marunouchi, Chiyoda-ku, Tokyo, Japan | |
(3) | Representative | Atsuhiko Sakamoto, Representative Director | |
(4) | Scope of business | Investment and management of securities such as stocks | |
(5) | Capital | 1 yen | |
(6) | Date established | July 30, 2020 | |
(7) | Net assets | 1 yen | |
(8) | Total assets | 1 yen | |
(9) | Major shareholders and ratio of shares held | Oscar Holding GK 100% (100% subsidiary of private equity fund that The Blackstone Group Inc. (NYSE: BX) and its affiliate manage) | |
(10) | Relationships with Takeda | Capital Relationship | None |
Personnel Relationship | None | ||
Business Relationship | None | ||
Related Party of Takeda | None |
- Number of shares to be transferred, transfer price, and number of shares held by Company before and after transfer
(1) | Number of shares held before transfer | 200 shares (Number of voting rights: 200) (Percentage of voting rights: 100%) |
(2) | Number of shares to be transferred | 200 shares (Number of voting rights: 200) |
(3) | Transfer price | Enterprise value JPY 242.0 billion (Actual transfer price will be determined after adjustment for items including net debt and working capital of TCHC and THP) |
(4) | Number of shares held after transfer | 0 shares (Number of voting rights: 0) (Percentage of voting rights: 0%) |
- Schedule
(1) | Date of decision on share transfer by the Director delegated by the board of directors | August 24, 2020 |
(2) | Date of conclusion of agreement on share transfer | August 24, 2020 |
(3) | Date of transfer of shares | March 31, 2021 (scheduled) |
- Future outlook
- Other
Revenue | Core Operating Profit | Operating profit | Profit before income taxes | Net profit attributable to owners of the Company | Basic earnings per share | Core EPS | |
FY2020 Forecast | 3,250,000 | 984,000 | 395,000 | 230,000 | 92,000 | 58.91 yen | 420 yen |
FY2019 Results | 3,291,188 | 962,200 | 100,408 | -60,754 | 44,241 | 28.41 yen | 387 yen |