Shire PLC, the second-largest biotech employer in Massachusetts, said Tuesday that it had accepted a $64 billion takeover offer from Takeda Pharmaceutical Co. and would recommend the sweetened deal to shareholders.
It was the fifth proposal made by the Japanese company since it first expressed interest in Shire on March 28. On Friday, Takeda offered about $62 billion. Shire’s board had rejected earlier bids, saying they undervalued the company.
Final terms of the deal — it would be the largest overseas acquisition ever by a Japanese company — still need to be hashed out by the two companies, Shire said in a statement. Completion will hinge on a due-diligence review by Takeda, unanimous approval by Shire’s board, and final approval by Takeda’s directors.
Founded in 1986 in the United Kingdom by four entrepreneurs and initially selling calcium supplements from above a shop in England, Shire is today best known as the maker of Adderall, a treatment for ADHD. It has also become one of the world’s biggest makers of medicines for rare diseases, known as orphan drugs.
Shire is based in Ireland but has most of its operations in Lexington and more than 3,000 workers in Massachusetts.
Analysts said Shire appealed to Takeda because of its stock price and because Shire’s product portfolio and pipeline complement its own.
Shire’s stock price had fallen 45 percent in the 15 months before Takeda’s announcement on March 28. Shire’s shares rose 2.4 percent to close at $163.93 on Tuesday. They jumped more than 5 percent in after-hours trading following its announcement.
The deal is expected to bolster Takeda’s neuroscience and gastrointestinal units.
“There’s a very strong strategic overlap there,” John T. Boris, an analyst at Suntrust Robinson Humphrey in New York, said before the deal was announced.
The takeover would give Takeda a foothold in the market for rare-disease drugs. The US government gives drug makers financial incentives to develop medicines for disorders that afflict 200,000 or fewer patients.
And the acquisition would catapult Takeda, which has few late-stage experimental drugs in its own pipeline, into the ranks of the world’s biggest pharmaceutical companies. Takeda was already Asia’s largest drug maker.
“Takeda has been consistent on its interest in M&A and highlighted a focus on GI, oncology, and neuroscience,” Andrew Finkelstein, an analyst for Susquehanna Financial Group, in New York, wrote recently.
The deal would be a financial stretch for Takeda, which was founded in 1781, incorporated in 1925, and first entered the US drug market in 1977, in a joint venture with Abbott Laboratories. Shire is worth at least $10 billion more than Takeda. And it had debt of about $19 billion at the end of last year.
The transaction would continue a trend in which major foreign drug companies have sought to expand their presence in the Boston area, the nation’s leading biotechnology hub.
Takeda planted its flag in Massachusetts a decade ago, when it bought Cambridge-based Millennium Pharmaceuticals, one of the state’s best-known biotech companies, for $8.8 billion. Millennium became the cancer-fighting division Takeda Oncology.
Early last year, Takeda paid $5.2 billion for Ariad Pharmaceuticals Inc. of Cambridge, which has a blood cancer drug on the market.
Shire had drawn interest from other drug makers, too. In 2014, its chief executive, Flemming Ornskov, fought off a proposed takeover by AbbVie Inc. Last week, as Takeda wooed Shire, Allergan said it was also considering a bid before deciding against it just hours later.
Shire agreed to extend a deadline required under the United Kingdom’s takeover rules to May 8 for the companies to continue their talks.
Takeda shares tumbled as much as 9.3 percent in early trading in Tokyo on Wednesday. The Japanese company is offering the equivalent of 49 pounds ($68.55) per share, including 27.26 pounds in stock and 21.75 pounds in cash, Shire said in a statement. That’s a 60 percent premium to Shire’s closing share price on March 27, before Takeda disclosed it was interested in the US drug maker.
Last week, Takeda raised its offer to 47 pounds a share and lifted the cash portion of the bid after three prior proposals were rejected.
In Massachusetts, only Sanofi Genzyme, the rare-disease unit of the French drug giant Sanofi, is bigger than Shire; it has about 5,000 employees, according to the Massachusetts Biotechnology Council.
Material from Bloomberg News was used in this report. Jonathan Saltzman can be reached at jonathan.saltzman @globe.com.