AstraZeneca has turned down a final offer for the company by rival Pfizer saying that the value of £55 per share ‘undervalues the company and its attractive prospects’.
At 8.45 shares in the business were down 14.17% at £41.39 - back where they stood before the bid was announced in April.
Following a political row over the attempted buyout, Pfizer ruled out taking the bid hostile. The Labour party, which could be in power by the time any potential bid was finalised, has said it would consider a public interest test before offering regulatory approval.
Following the rejection of the mixed cash and equity offer Astra chair Leif Johansson said: ‘Pfizer's approach throughout its pursuit of AstraZeneca appears to have been fundamentally driven by the corporate financial benefits to its shareholders of cost savings and tax minimisation.
‘From our first meeting in January to our latest discussion yesterday, and in the numerous phone calls in between, Pfizer has failed to make a compelling strategic, business or value case.
‘We have rejected Pfizer's final proposal because it is inadequate and would present significant risks for shareholders, while also having serious consequences for the company, our employees and the life-sciences sector in the UK, Sweden and the US.’
Pfizer had offered £53 per share after markets had closed on Friday. AstraZeneca indicated that it would not consider anything less than a 10% improvement pf those terms.
The company pointed to what it described as a ‘growing and accelerating’ number of drugs close to approval which it believes could have potential sales of up to $23 billion (£13.6 billion) a year.