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Sadly, it is now off more than 100p. Somebody knows something for this sudden drop from positive territory.
SP down 90p today. Not looking good for a deal announcement is less than 2 weeks.
Seemingly on the back of media reports that Takeda are sounding out multiple banks to lend them the huge amounts needed to fund a Shire takeover - what did it expect it was doing 13 days before the deadline? Hardly news but the market reacts nevertheless. Also it reference me a deal of c$40bn when Shire currently trades at in excess of $46bn!...ATB, Scfc
https://www.google.co.uk/amp/s/uk.mobile.reuters.com/article/amp/idUKKBN1HJ0D9 (Reuters) - Takeda Pharmaceutical (4502.T) has sounded out its major creditors for loans, two sources with direct knowledge of the matter said, as it moves closer to a bid for London-listed rare-disease specialist Shire (SHP.L) that could top $40 billion. Expectations that Japan's largest drugmaker by sales will bid for Shire before an April 25 deadline have mounted since its chief executive Christophe Weber discussed the strategic case for the deal at a briefing with analysts last week. Weber said at the briefing, which was closed to the media, that Takeda was weighing a deal for all of Shire and there was scope to increase debt, according to analysts. Takeda has sounded out creditors including its main bank Sumitomo Mitsui Banking Corp, the two sources said on Thursday, declining to be identified as the matter was confidential.
Takeda, Japan�s largest drugmaker by sales, has sounded out creditors including its main bank Sumitomo Mitsui Banking Corp, two sources said, declining to be identified as the matter was confidential.
Volumes were quite low today as compared with recent days (c2.2m) so I wouldn�t read too much info the SP fall but that said I�ve made my views clear several times as to the apparent financial sense before. Just a few days to wait whichever way it goes...ATB, Scfc
No, but did they expect a 14% drop in their SP? Did they know whether shareholders have the appetite for a $30bn rights issue? I suspect that they thought they could pull it off but this may be beyond them already based on relative SPs and shareholder reaction.
Everything you say is correct but Takeda arent just learning all this now . Imo there is a strong argument either way . Time will tell
Previously I thought that there was about a 60:40 chance of Takeda making a bid. The slow creeping of the SP kind of tells me that it is looking more unlikely. Enough people know the reality such that leaks are inevitable and the SP responds accordingly. So if a bid of �39/40 was genuinely due with the next 2 weeks, the SP would not be drifting down as it is. Therefore I this it is now pretty unlikely that they will bid. At the end of the day, the maths does not work for a company as small as Takeda where they have strict financial criteria. I think they will announce that they are not pursuing the deal before the 25th deadline. All in my opinion only......
Who�s they?
Does anyone know what they are talking about regarding the share price
well, let's hope that Shire turns into Red Rum :) --BB--
Being new to buying shares i decided to listen to the �experts� and bought shire although my choice was astrazeneca which at the time were �43 a share. Astrazeneca went up to �52 and shire shares went below �30 until this takeover talk so i will never listen or believe a broker�s recommendation ever again. It says it all when an amateur like me who knew nothing about shares was picking astrazeneca and the �experts� swayed me into picking the donkey!
Hi, technical analysis in general (including RSI) goes out of the window during possible M&A periods...prices move on possible bid prices so I�m surprised such an article has been written with this in mind. I would be far concerned on �deal or no deal� issues as they �trump� any technical indicators which I do use but not at the moment for SHP. ATB, Scfc
i see what you say :) i am hoping that an offer does come and you get a positive outcome for your purchase! -- BB --
I�ve no idea but the fact that 19 out of 20 brokers rate as buy means absolutely nothing. When i bought my shire shares every single broker had a strong buy rating and yet the shares fell every single month since so i would not trust a single word that they say!
quick question though - does the RSI take account of the "possible" Takeda offer? i was also looking at webfg and 19 out of 20 brokers still have a "buy" rating ... -- BB --
Shire plc SHPG has moved higher as of late, but there could definitely be trouble on the horizon for this company. That is because SHPG is now in overbought territory with an RSI value of 76.41. What is RSI? RSI stands for �Relative Strength Index� and it is a popular indicator used by technically focused investors. It compares the average of gains in days that closed up to the average of losses in days that closed down; readings above 70 suggest an asset is overbought, while an RSI below 30 suggests undervalued conditions are present. Other Factors Yet SHPG�s high RSI value isn�t the only reason for investors to be concerned, as there has been some decidedly negative earnings estimate revisions in Shire�s stock as of late. This is especially true when investors dive into some of these revisions in order to get a better picture of SHPG�s prospects for the near term. Over the past two months, investors have witnessed 10 earnings estimate revision lower compared to none higher for the current year. The consensus estimate for SHPG has also been on a downward trend over the same time period too, as the estimate has fallen from $15.96/share two months ago to just $15.23/share today. If this wasn�t enough, Shire also has a Zacks Rank #4 (Sell)which puts it into unfortunate company among its peers. So, given all of these factors, investors may want to consider exiting this stock now before it falls back to Earth.
Redtom. Yep, it will inevitably fall if they chose not to bid - initially a larger fall under an overreaction as the �market herd mentality� kicks in - that said, I also hope nobody is influenced by my sceptical view - I�m just looking at it from an objective (financial) view which is often hard - they may put in a bid but based on all info in the public domain I just can�t see how they can do it IF they don�t move away from their strict investment criteria quoted. The key here is aren�t privy to all info so who knows; we will know in c2 weeks (maximum). ATB, Scfc
Scfc, In a way Takeda have a very easy 'get out', here. Ie that the SP of both has moved against them as has the fx rate. They can walk away and save face. The more I think about this the more I see it failing before it even starts. Think I might sell in the �36s as this will drop 10%/15%/20% when they do pull out.
I would be very surprised is if they offered c�40 per share ie $56bn total when their own share market cap is c$37bn and falling! As I have mentioned before the finances don�t work from what I can see if they wish to maintain all their existing dividend policy and credit rating, etc. Others maybe, but Takeda? If we go back a couple of months or so (when they first were looking at it) the respective maket caps were closer but not now...also the Takeda SP has fallen a lot in 2018 (even before the announcement) and the exchange rate is now going in the other direction as well. If anybody has any ideas how this could work I�m all ears. ATB, Scfc
Arbitrader75, I have to agree with you. Takeda are likely to offer �40 tops. That is $56bn. It would not surprise me if they offered slightly lower than �40.
" if we start talking about c�45+ offers" yeah don't do that, they will never offer that much, this is not a small biotech.
I agree . If one of the big boys dont come sniffing then the s/p will drop 15-20% imo . I'll be surprised if a bid isnt made though which could trigger a rival offer . Even if nothing happens this time I dont expect shp to be around in 2yr.
I think the SP fall is more of a matter of the market guessing (like we all are) but as I�ve said all along, I just can�t see how they can afford it. I�ve seen suggestions of a significant equity issuance and they have �massive debt on tap� but neither of which align to their supposed strict investment criteria as well as the suggestion they will maintain dividends (esp. as the yield offered by Takeda is much greater than that of Shire at present...so how?) If we then look at the large debt funded deal, well that would be huge notwithstanding the taking on of Shire�s existing c19bn. So even if they could raise the funds by either, or a mixture - then this just doesn�t add up financially imo. And then if we start talking about c�45+ offers then the gap between Shire and Takeda�s market caps is even more stark. Lots of press articles saying it can now make a credible offer (on the back of the CEO�s bullish statement last week) but they never seem address the fundamental points I�ve highlighted. Time will tell of course but I�ve never been convinced from Day 1 given their relative size and need to maintain their credit rating, etc,etc. ATB, Scfc