AstraZeneca Plc made an official statement on Friday, saying that it rejected the increased bid of Pfizer Inc. Pfizer Inc. made an acquisition proposal, which amounted to 63.1 billion pounds (106.5 billion dollars) but was denied because in AstraZeneca’s opinion Pfizer hadnt taken into account the promising perspectives of its drugs under development.
Mr Leif Johansson, who is the Chairman of AstraZeneca, said in the company’s statement, which was cited by Bloomberg: “Pfizer’s proposal would dramatically dilute AstraZeneca shareholders’ exposure to our unique pipeline and would create risks around its delivery. As such, the board has no hesitation in rejecting the proposal.” As reported by the Wall Street Journal, the company also said: “The large proportion of the consideration payable in Pfizer shares and the tax-driven inversion structure remain unchanged. Accordingly, the board has rejected the proposal.”
The British drug maker commented that the financial, as well as other terms of Pfizer’s bid were inadequate. It suggested Pfizers Chief Executive Officer – Mr. Ian Read should raise the company’s offer, negotiate directly with AstraZeneca’s shareholders or withdraw from the deal.
This was the second takeover offer made by Pfizer after its first bid in January 2014. On Friday it raised its offer for an eventual merger with the second-largest drug manufacturer in the U.K. after the Chief Executive Officer of the company had a meeting with AstraZeneca’s shareholders and official representatives of the British government.
However, AstraZeneca may not be supported by the country’s government and the Prime Minister. The government hinted that it does not intend to intervene in the deal and even rejected some political parties’ demands to be more active in protecting jobs in the industry.
As reported by Bloomberg, U.K. Prime Minister Mr. Cameron commented the situation in an interview: “AstraZeneca has a fantastic role in the British economy. Action on any merger is a decision for both companies. We’ve sought and received robust assurances from Pfizer should the deal go ahead.”
AstraZeneca Plc lost 0.15% on Friday to close the session at 4 808 pence per share, marking a one year change of +44.95%. The company is valued at 60.77 billion pounds.
Pfizer Inc. fell by 1.28% to $30.75 per share in New York, marking a one-year change of +5.06%. According to the Financial Times, the 13 analysts offering 12 month price targets for Pfizer Inc. have a median target of $34.00, with a high estimate of $41.00 and a low estimate of $29.00. The median estimate represents a 10.57% increase from the last price of $30.75
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