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Shire Pharmaceuticals Plc (SHPG) - Get Shire PLC Sponsored ADR Report said Monday that it will sell its oncology business to France's Servier SAS as it continues to discuss a possible $50 billion takeover play by Japan's Takeda Pharmaceutical Co.  (TKPYY)

Shire will sell the unit, which had $262 million in sales last year, for around $2.4 billion, the company said. Shire also said the gross assets for sale are around $1.6 billion and the profits attributable to the assets that will be sold is around $140 million. Shire added that it will consider using the proceeds for an investor-approved share buyback once the offer period for Takeda's approach expires on April 25. Shire expects the deal, which does not require shareholder approval, to close by the third quarter of this year. 

"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," said CEO Felmming Ornskov. "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."

Takeda, Japan's biggest drugmaker by sales, confirmed its interesting in Shire late last month and said a takeover would bolster its core therapeutic areas of oncology, gastroenterology and neuroscience and align the company with market opportunities in the U.S. It also noted value propositions in Shire's global rare disease franchise.

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"Takeda's consideration of such an offer is at a preliminary and exploratory stage, and no approach has been made to the board of Shire," the company said in a statement. "There can be no certainty that an approach, if made, will lead to any transaction."

Shire, with group headquarters in Dublin, U.S. operational headquarters in Lexington, Mass., and international operational headquarters in Zug, Switzerland, confirmed March 28 that it has not received a formal approach from Takeda.

Shire shares added 1.6% in the opening minutes of trading in London to change hands at 3,664 pence each, a move that takes its post-Takeda approach gain to around 19.1% and values it a just over $47 billion.