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Astrazeneca reject Pfizer's 'inadequate' fresh bid

by Danielle Levy on May 02, 2014 at 12:44

Astrazeneca reject Pfizer's 'inadequate' fresh bid

Astrazeneca has rejected a fresh takeover bid from US rival Pfizer valuing the pharmaceutical giant at £50 per share.

In a statement to the stockmarket Astra described the bid as 'inadequate' adding 'it substantially undervalue AstraZeneca and are not a basis on which to engage with Pfizer'.

'The large proportion of the consideration payable in Pfizer shares and the tax-driven inversion structure remain unchanged,' AstraZeneca said in its statement. 'Accordingly, the board has rejecting the proposal,' the drugs giant told the market.

At 12.30pm shares in Astra were off 9p at 4,806p.

The offer represents a  premium of 32% for AstraZeneca shareholders and an even higher 39% premium to the closing price of £35.86 on 3 January 2014, the trading day immediately prior to the date of Pfizer's January proposal.

As part of the deal AstraZeneca shareholders would receive 1.845 shares in the combined company for each AstraZeneca share, and 1,598 pence in cash, representing an indicative value of £50.00 per share.

The US pharma wrote to prime minister David Cameron, reassuring the government of its 'long term commitment to the UK', where it said Pfizer already employs a significant number of colleagues across research, commercial, and administrative roles.

Amongst its promises, it said the combined company's corporate and tax residence would be established in England, with a substantial R&D innovation hub in Cambridge to be completed and 20% of the combined company's total R&D workforce would be in the UK going forward

Pfizer said the offer had been made, having consulted with major shareholders,with the intention of combining the two companies. Pfizer hopes the increased proposal will provide the basis for AstraZeneca to engage with Pfizer and enter into discussions.

In a statement issued on the Stock Exchange earlier this morning, Pfizer said its chairman and CEO contacted AstraZeneca's chairman prior to the revised offer and AstraZeneca indicated it would respond after its board has reviewed the proposal.

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2 comments so far. Why not have your say?

Martin Ashworth

May 02, 2014 at 09:35

Remember, that's exactly what the Yanks said when they were trying to buy Cadburys. They "said" they wouldn't close any factories in the UK and would maintain a UK Corporate presence. As soon as the ink was dry, they closed all UK factories, except one, and shipped the whole production to Eastern Europe. Beware Yanks with fat cheque books.

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Anonymous 1 needed this 'off the record'

May 02, 2014 at 11:31

Agree with Martin, they can't be trusted Dave and this time its not just chocolate at stake!

Pfizer couldn't give a sh*t about the UK. They have only just shut Kent with the loss of 2500 jobs.

Viagra was developed in a British lab and then we were shafted. No pun intended.

Their promises are not worth the paper they are written on.

The French don't get much right but we should learn a lesson from them on this one

This must not go ahead. Trouble is I don't think call me Dave has any backbone.

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