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Takeda is in talks with Shire after its $61 billion bid was rejected

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hristophe Weber, president and chief executive officer of Takeda Pharmaceutical

Yuriko Nakao | Bloomberg | Getty Images

hristophe Weber, president and chief executive officer of Takeda Pharmaceutical

Japan’s Takeda Pharmaceutical is in negotiations with Shire after making a third takeover bid worth around $61 billion that was rejected by the London-listed rare diseases drugmaker.

Reuters first reported that Takeda had made a cash-and-stock takeover offer of 46.50 pounds a share, prompting Takeda to issue a statement confirming the move. The latest offer was made on April 12.

“Takeda was subsequently notified that the board of Shire had rejected its proposal. Discussions between the parties regarding a potential offer are ongoing,” the company said on Thursday.

Shire confirmed that it had received three conditional proposals from Takeda.

The announcement comes ahead of an April 25 deadline for Japan’s biggest drugmaker to make a firm offer or walk away from the FTSE 100 company, after it said last month it was considering a bid.

Shares in Shire were up 3 percent at 38.64 pounds in London.

Buying Shire would be transformational for Takeda but would be a big financial stretch, since the company is worth in excess of $10 billion more than the Japanese group. Shire also had debt of around $19 billion as of the end of 2017.

Takeda’s rejected bid comprised 17.75 pounds in cash, which would be paid in U.S. dollars, and 28.75 pounds worth of new Takeda shares. That would value Shire at approximately 43 billion pounds, or $61 billion, Thomson Reuters data showed.

A successful acquisition of Shire would be the largest ever overseas acquisition by a Japanese company and propel Takeda, led by Frenchman Christophe Weber, into the top ranks of global drugmakers. It would significantly expand its presence in the all-important U.S. market.

Shire is best known for selling treatments for rare diseases and attention deficit disorder. Earlier this week it struck a deal to sell unlisted French group Servier its cancer drugs for $2.4 billion.

The drugs industry has seen a surge in deal-making this year as large players look for promising assets to improve their pipelines, but a Takeda-Shire transaction would be by far the biggest yet.

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U.S. stock futures drop after Fed signals no rate hikes until 2023

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Julius Shakari, from California in full PPE gear, takes photos with his friend in front of the Charging Bull, sometimes referred to as the Wall Street Bull, a bronze sculpture in the Financial District of Manhattan New York May 19, 2020.

Timothy A. Clary | AFP | Getty Images

U.S. stock futures were lower early Thursday morning as traders digested the Federal Reserve’s pledge to keep rates low over the next few years.

Dow Jones Industrial Average, which earlier traded just below the flatline, fell 244 points. S&P 500 and Nasdaq 100 futures also traded in negative territory. 

Members of the Federal Open Market Committee indicated the U.S. overnight rate could stay anchored to the zero-bound through 2023 as the central bank tries to spur inflation. In a statement, the committee said: “With inflation running persistently below this longer run goal, the Committee will aim to achieve inflation moderately above 2% for some time so that inflation averages 2% over time.”

Fed Chairman Jerome Powell reiterated this stance in a news conference, saying easy monetary policy will remain “until these outcomes, including maximum employment, are achieved.”

He also said that parts of the U.S. economy will keep struggling unless lawmakers move forward with further fiscal stimulus. That comment from Powell came as lawmakers struggle to reach a deal on a new coronavirus aid bill. Earlier on Wednesday, White House chief of staff Mark Meadows said he was optimistic a deal could be struck.

Normally, the prospects of lower rates for a prolonged time period spur buying in equities. However, that was not the case on Wednesday.

The S&P 500 and Nasdaq both closed lower and the Dow ended well off its session high. Big Tech dragged down the S&P 500 and Nasdaq, with Apple, Facebook and Microsoft all closing lower.

“The major indices dipped back to their short-term trading range following the Fed’s announcements, confirming that bulls are still not out of the woods,” said Ken Berman, founder of Gorilla Trades. “While there was nothing scary in today’s Fed announcements, stocks reacted in a bearish fashion, especially in the tech sector.”

On Thursday, Wall Street will get the latest look at U.S. weekly jobless claims. U.S. housing starts data are also set for release.

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Europe jittery as cases rise and lockdowns return

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Tourists wearing a surgical face mask walk by the Trevi fountain in downtown Rome on August 19, 2020.

VINCENZO PINTO | AFP | Getty Images

LONDON — There are growing concerns in Europe at what is being seen as an alarming rise in coronavirus cases, with the number of new daily infections reaching record highs in some countries.

The European Centre for Disease Prevention and Control (ECDC) warned Wednesday that the 14-day case notification rate (the number of newly reported cases) for the EU, European Economic Area and the U.K. “has been increasing for more than 50 days, with over half of all EU countries currently experiencing an increase in cases.”

Spain, which has the highest number of confirmed coronavirus infections in Europe at 614,360, according to data collated by Johns Hopkins University (JHU), is reportedly set to announce targeted lockdowns in places where the virus is spreading rapidly, and renewed restrictions of movement on Friday.

Meanwhile in France, the number of new daily cases reported Wednesday (9,784) was among the highest ever reported in the country. It was just below an all-time record of 10,561 new cases recorded on Saturday.  The number of people being treated in intensive care units for Covid-19 also rose for the 20th straight day Wednesday, Reuters reported, to a three-month high of 803. The total number of cases in France stands at 404,888, according to the French Health Ministry.

Remarking on the rise in cases, French President Emmanuel Macron said Wednesday that the virus was circulating “quicker and quicker in certain parts of the country,” Reuters reported.

The U.K., which has the third-highest number of cases in Europe, at 380,677 according to JHU data, has seen an alarming rise in cases across various parts of northern England in recent weeks. It has started to reintroduce measures to restrict social gatherings, with the number of people allowed to meet now limited to six in England. Stricter measures targeting north-east England could be announced Thursday, the BBC reported.

Italy, which was the epicenter of Europe’s first coronavirus outbreak in February but now has the fourth-highest number of reported infections, at 291,442 to date, has also seen cases rise. The health ministry said Wednesday that Italy has registered 1,452 new cases in the last 24 hours, up from 1,229 new cases on Tuesday, although this was partly attributed to a sharp increase in coronavirus tests, news agency ANSA reported. Nonetheless, the health ministry noted that Italy is seeing the highest number of active cases since June, with 40,532 people currently infected with the coronavirus.

Germany, which was seen as a poster-child for its handling of the first wave of the coronavirus cases, having managed to keep its death toll low compared to its number of cases, has seen a slight rise in cases.

The Robert Koch Institute, which monitors the epidemic in Germany, said Wednesday that “the increase in the number of cases reported since mid-July had stabilized at a slightly higher level in calendar weeks 35 (beginning August 24) and 36, but since calendar week 37, a slight increase can be observed again.” It added that more young people have become infected in recent weeks.

So far, the death toll from rising infections has been significantly lower than in spring and early summer when the virus first hit Europe, but the World Health Organization (WHO) has warned that this could change as winter approaches.

‘The pandemic is not over’

The increases in the number of reported infections has, in part, been attributed to more sophisticated and active testing regimes in Europe, but the ECDC said Wednesday that “although increased testing contributes to better awareness of all ongoing transmission, it is not the only reason for the increase of Covid-19 cases.” It linked the rise to the relaxation of physical distancing and other preventive measures.

“As schools reopen and more indoor activities are held, the increase of cases comes as a reminder that the pandemic is not over,” the ECDC warned, as it reminded the public to continue basic measures to prevent the spread of the virus, including hand washing, face masks and self-isolation when feeling ill.

There are concerns that healthcare systems could be overwhelmed as winter nears and the ECDC noted that, as flu season approaches, the preparedness of healthcare systems across Europe is “vital.”

“This includes essential services, primary care facilities and hospitals ensuring appropriate surge capacity plans in case of a high demand for the care of patients with respiratory distress,” it said.

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