Takeda Pharmaceutical and Shire have finally agreed terms for a merger, ending a takeover battle that has seen the Japanese drugmaker bid five times since late March for the Ireland-domiciled group.

The boards of both companies have approved the £46 billion acquisition, which is set to complete in the first half of 2019, providing approvals are given by shareholders and regulatory authorities along with the usual closing conditions are met. The deal needs support from two-thirds of Takeda’s investors and 75% of Shire’s shareholders to succeed.

Upon completion, Shire will own approximately 50% of the combined group and up to three of its directors will join Takeda’s board. The move, which will be the largest foreign takeover by a Japanese company, is part of Takeda’s strategy to become a global pharmaceutical group.

 “Shire's highly complementary product portfolio and pipeline, as well as experienced employees, will accelerate our transformation for a stronger Takeda. Together, we will be a leader in providing targeted treatments in gastroenterology, neuroscience, oncology, rare diseases and plasma-derived therapies,” said Christophe Weber, Takeda’s president and CEO.

Shire’s chairwoman, Susan Kilsby, said: "We firmly believe that this combination recognizes the strong growth potential of our leading products and innovative pipeline and is in the best interests of our shareholders, our patients and the communities we serve."

The combined group will be headquartered in Japan with major regional locations in Japan, Singapore, Switzerland and the US. Takeda said the acquisition will result in it being the only pharmaceutical company listed on both the Tokyo and New York Stock Exchanges, enabling it to access two of the world’s largest capital markets.

The Osaka-headquartered group anticipates that pretax cost synergies for the integrated company will reach an annual run-rate of at least $1.4 billion by the end of the third fiscal year after the deal’s completion. A major portion of this is expected to come from combining R&D operations, in particular the early stage pipelines.