AstraZeneca Rejects Pfizer *Final Offer*

Sky News – 

AstraZeneca has rejected US rival Pfizer's "final offer" takeover bid, which valued the company at £69.3bn.

The British drug giant said the offer of £55 a share falls short of its value as an independent company and that Pfizer had failed to "make a compelling strategic business or value case".

It said the Pfizer proposals would bring "uncertainty and risks" for AstraZeneca shareholders.

AstraZeneca's chairman Leif Johansson told Sky News: "We rejected the bid on three grounds. First, is we think it undervalues the opportunities we think AstraZeneca could have as an independent company. 

"Secondly, we think there is a long, drawn-out process, with very considerable execution risk ... and thirdly, we think there is a clearly disruptive element in how we can best create value for shareholders and society by disrupting the way we get medicines to the market." 

The response came hours after Pfizer dramatically raised its bid late on Sunday, giving AstraZeneca until 5pm on May 26 to make a decision.

AstraZeneca shares plunged by as much as 14% in early trading, driving its market value down to £52.1bn, £17bn less than the value Pfizer had put on the company.

Pfizer has said it will not make a hostile offer directly to AstraZeneca shareholders, and would only proceed with an offer with the recommendation of AstraZeneca's board.

The company told Sky News "we are considering our options" after its proposal was rejected.

Sky News City Editor Mark Kleinman said: "The AstraZeneca board has highlighted the inherent risks in doing a deal with Pfizer at any price - the risk to jobs that would be triggered from a merger of this kind.

"But unusually in AstraZeneca's statement, it has put a price tag on itself ... it says it would only be prepared to make a recommendation to shareholders if the board of Pfizer were to make an offer that was at least 10% above the £53.50 per share that was made privately on Friday.

"That would put a price tag on AstraZeneca of about £59 a share - well over £70bn."

The latest rejected bid increased the cash element to 45%, with AstraZeneca shareholders set to receive 1.747 shares in the enlarged company for each of their AstraZeneca shares and 2,476p in cash.

AstraZeneca had rebuffed an earlier cash-and-stock approach worth £50 a share on May 2, arguing it substantially undervalued the company.

Pfizer wants to create the world's largest drugs company, with its headquarters in New York and a tax base in Britain.

Investors backed AstraZeneca in rejecting the offer of £50 a share, but many said they would want it to engage if Pfizer came back with an improved offer.

There has been growing concern over the proposed deal in recent weeks in Britain, the US and in Sweden, where AstraZeneca has some of its roots.

Politicians fear the deal could lead to job losses among AstraZeneca's 6,700 UK-based staff and delays in the development of life-saving drugs.

But Pfizer boss Ian Read told MPs this week that a merger would accelerate the delivery of products to patients.

He said: "There is absolutely no truth to any comment that some products of (a) critical nature would be delayed getting to patients. If anything we would accelerate that to patients."

Mr Read also guaranteed that 20% of the new firm's research and development workforce would be based in the UK.

https://uk.news.yahoo.com/astrazeneca-rejects-pfizer-final-offer-061848793.html