Human Capital & Careers

Easing the Retention: Takeda Pays Merger Bonuses

Japanese firm's Rx for angst at Millennium is the "unusual" step of offering broad incentives to get employees to stay.
Stephen TaubApril 15, 2008

Takeda Pharmaceutical Co. is putting its money where its mouth is in its proposed $7.56 billion cash acquisition of Millennium Pharmaceuticals.

When the Japanese drug company last week announced it would acquire Millennium, Takeda president Yasuchika Hasegawa said in a press release: “Millennium has strong discovery, development, and commercial capabilities led by a well-established management team. Our strong desire is to retain Millennium employees, who have created an entrepreneurial and innovative culture.”

Sure enough, Takeda Monday said it wouldl offer unspecified retention bonuses to most Millennium employees to stay with the company for 12 to 24 more months after the takeover, according to the Boston Globe.

In addition, the Japanese company does not plan to layoff any of Millennium’s 1,000 employees, according to the report. In fact, the current management team, including chief executive Deborah Dunsire, is expected to remain running the company under the Millennium name.

“It’s highly unusual,” Anna Protopapas, senior executive vice president at Millennium, told the Globe.

The monetary offer is designed to quell concerns among Millennium’s employees that they might lose their jobs, which is customary when two companies in the same industry merge. Indeed, the CEOs of Delta Airlines and Northwest Airlines said Tuesday that a number of employees at their headquarters would lose their jobs when the two airlines complete their merger later this year.

“We are extremely proud of the commitment and passion of our employees, who have built this vibrant organization,” said Millennium’s Dunsire. “Both companies share a common vision to develop breakthrough medicines for patients, become a global leader in oncology and expand the global reach of our IBD product candidates. We expect this transaction to help accelerate that vision and deliver tremendous value to patients, shareholders and our employees.”