Takeda is about to acquire an unhappy Shire workforce
Takeda Pharmaceuticals' ($TYO:4502) $62 billion acquisitiom of Shire ($NASDAQ:SHPG) would make it the 4th-largest M&A deal of the past five years. Analysts are already picking apart the deal, saying that even with the $1.4 billion in cost savings that Takeda says it would make at Shire, the deal could put financial restraints on both firms that won't be good for shareholders in the long run.
Takeda, based out of Osaka, Japan, clearly sees the acquisition of Irish (and now US-based) Shire as a way to extend its global reach. It also doesn't hurt that Shire makes Vyvanse, Lialda, and Adderall XR, three very profitable drugs. Shire also comes with a portfolio of rare-disease drug that virtually guarantee revenue.
One thing analysts have not talked about in regards to this deal, however, is the health of Shire itself. Sure, the product portfolio looks good on paper, but what's happening internally at the company? Are we destined for a culture clash when (and if) this deal gets approved?
Is Shire, itself, ill?
The data says it may be.
Hiring Activity at Both Companies Has Dropped
Shire hiring activity has slowed over the past month. That said, so has hiring at Takeda. This is likely a move to reduce ongoing costs as the acquisition takes place while at the same time looking favorable for auditors. That said, a drop in hiring means a possible loss of talent leading into a period when the company will need it most as Shire employees meet their new bosses.
How Shire Employees are Feeling
We track Glassdoor rankings, aggregate them, and watch them move over time in order to see any changes in how employees are feeling about their companies. In the case of Shire, employee reviews of the company have been on a steady decline across the board - overall rating, CEO rating, and Business Outlook rating.
Looking at the mix of ratings over time is often more telling. Since last summer, 1-star (out of 5) ratings of the company by employees have been on a steady rise while 5-star ratings have plateaud. This is a sign that those who have come to Glassdoor to vent about their experiences with the company have been unhappy employees, at least for the past year.
Shire CEO (and ex-Bayer star) Flemming Ørnskov saw a 52% approval rating in July, 2017. While that's not exactly spectacular, over the past year employees have come to Glassdoor to express their dislike of the CEO, with overall ratings hiting a low of 26% in January, 2018 and settling this week at just 29%.
When it comes to how employees feel the comapny will fare in the future, they're equally unhappy. Beginning last summer, outlook ratings took a steep dive from 41% to 23% in just three months. As of today, business outlook ratings by Shire employees remains at a dull 27%.
All of this could just be pre-acquisition cold feed by empoyees who see inevitable post-merger redundancy measures as possible ends to their careers with the comapny. Even if that's the case, Takeda appears that it's about to have some company culture issues on its hands.