The Japanese conglomerate is expected to pay around 200 billion yen ($1.93 billion) for Takeda's roughly 70% stake in Wako Pure Chemical Industries. A basic agreement on the acquisition is expected as soon as this month. The goal is to complete the purchase by the end of March 2017.
Fujifilm, Hitachi Chemical and the Carlyle Group, a U.S. private equity fund, all participated in the final round of bidding for the stake in October. Takeda has begun notifying involved parties that it will prioritize talks with Fujifilm, which offered the most of the three contenders, exceeding the maximum amount the Hitachi unit said it would pay.
Wako is Japan's leading producer of research reagents, with sales of around 80 billion yen in fiscal 2015. Offerings include promising new technologies, such as reagents used in the production of embryonic stem cells and induced pluripotent stem cells, or iPS cells -- valuable assets for businesses or investment funds looking to bolster medical operations.
Fujifilm is already Wako's second-largest shareholder, with an almost 10% stake. The duo's ability to create synergies by teaming up on technology and sharing drug sales channels apparently influenced Takeda's choice of buyer.
Fujifilm is already a strong player in the market for medical devices such as endoscopes and X-ray equipment. But the company has been expanding its reach of late with acquisitions including midsize drugmaker Toyama Chemical and an American regenerative medicine startup. Adding Wako to the lineup is seen bolstering drug development and cancer diagnostics operations, as well as helping the new parent crack the market for medical test agents in emerging nations.
There is little hope for major growth in the market for office machines or digital cameras, some of the Japanese company's core businesses. But the medical field holds more promise. Sales in Fujifilm's health care operations came to around 420 billion yen in the year ended in March -- nearly 20% of the group total. The company lost out to Canon in the battle to acquire Toshiba Medical Systems this spring. But other acquisitions are fueling the segment's growth, bringing the goal of becoming a trillion-yen business ever closer.
Takeda, meanwhile, is in the process of realigning to focus on core drug-development operations. The company announced the sale of its respiratory drug portfolio to AstraZeneca of the U.K. at the end of 2015. Proceeds are to fund the acquisition of companies with promising drug candidates as well as research and development activity. Takeda is currently in talks to buy Salix Pharmaceuticals, the stomach-drug business of Canada's Valeant, for around $10 billion.
Acquisitions have caught on with other pharma giants as well. Pfizer of the U.S. in August said it would buy a major American biopharmaceutical maker focused on the development of oncology drugs for $14 billion. Japan's Terumo has struck a basic agreement with such parties as Abbott Laboratories to purchase certain vascular closure products.