AstraZeneca rejects £63bn Pfizer bid

AstraZeneca has rejected a second and improved £62.8 billion takeover offer from Pfizer with "no hesitation".

Although Pfizer's assurances on investment helped to soothe political concerns over the £50-per-share bid, the AstraZeneca board deemed the offer, up 7 per cent from the original £46.61 move, still too low.

AstraZeneca’s decision came after a hastily convened board meeting in London this morning. The company said too much of Pfizer’s offer consisted of shares rather than cash, and criticised the fact that the Viagra maker’s rationale for the deal was based upon tax savings.

Pfizer’s chief executive Ian Read had attempted to soothe political concerns about the impact on Britain’s skilled workforce in a letter to the Prime Minister.

He also piled the pressure on Astra’s board to set up discussions, with the clipped comment: “Although we would have liked more time to meet privately to discuss our latest proposal, I believe that our revised terms are sufficient for you to agree to meet with us.”

Prior to the rejection, one top-10 investor told The Independent's sister paper, the London Evening Standard: “This is a serious enough offer for both companies to sit down and start talking. We’d be disappointed if the AstraZeneca board rebuffed this although the price will probably need to be higher. It’s a complex deal and it’s far from being done, we won’t make a decision until we see more details.”

Read told David Cameron of the virtues of “the “golden triangle” of Oxford, Cambridge and London, and pledged to complete AstraZeneca’s planned £300 million Cambridge campus, which has not yet broken ground, as well as employing at least a fifth of the combined company’s total reasearch and development (R&D) workforce in the UK.

Science minister David Willetts told the Evening Standard these assurances showed the success of the Government’s “hard-nosed and muscular” talks with the US company. “This letter is a result of those very clear messages from the British Government,” Willetts said, acknowledging, however, that many in the science community remain deeply concerned about the deal.

Pfizer spent only about 10 per cent of its revenues last year on R&D versus Astra’s 16 per cent spend and its record of takeovers is one of heavy job cuts.

Today Pfizer committed itself to offering at least two AstraZeneca board members a place on the new firm’s non-executive committee. It also agreed to hold board meetings in the UK and to “participate meaningfully in the UK”.

In today’s bid, the cash element has been raised to 32 per cent from 30 per cent. UBS told clients this should be seen as Pfizer’s “starting point”, and the cash part was too low.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Sales Executive / Foreign Exchange Dealer - OTE £40,000+

£16000 - £40000 per annum: Recruitment Genius: A Foreign Exchange Dealer is re...

SThree: Experienced Recruitment Consultant

£20000 - £40000 per annum + OTE + Incentives + Benefits: SThree: Established f...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE 40/45k + INCENTIVES + BENEFITS: SThree: The su...

Recruitment Genius: Collections Agent

£14000 - £16000 per annum: Recruitment Genius: This company was established in...

Day In a Page

Refugee crisis: David Cameron lowered the flag for the dead king of Saudi Arabia - will he do the same honour for little Aylan Kurdi?

Cameron lowered the flag for the dead king of Saudi Arabia...

But will he do the same honour for little Aylan Kurdi, asks Robert Fisk
Our leaders lack courage in this refugee crisis. We are shamed by our European neighbours

Our leaders lack courage in this refugee crisis. We are shamed by our European neighbours

Humanity must be at the heart of politics, says Jeremy Corbyn
Joe Biden's 'tease tour': Could the US Vice-President be testing the water for a presidential run?

Joe Biden's 'tease tour'

Could the US Vice-President be testing the water for a presidential run?
Britain's 24-hour culture: With the 'leisured society' a distant dream we're working longer and less regular hours than ever

Britain's 24-hour culture

With the 'leisured society' a distant dream we're working longer and less regular hours than ever
Diplomacy board game: Treachery is the way to win - which makes it just like the real thing

The addictive nature of Diplomacy

Bullying, betrayal, aggression – it may be just a board game, but the family that plays Diplomacy may never look at each other in the same way again
Lady Chatterley's Lover: Racy underwear for fans of DH Lawrence's equally racy tome

Fashion: Ooh, Lady Chatterley!

Take inspiration from DH Lawrence's racy tome with equally racy underwear
8 best children's clocks

Tick-tock: 8 best children's clocks

Whether you’re teaching them to tell the time or putting the finishing touches to a nursery, there’s a ticker for that
Charlie Austin: Queens Park Rangers striker says ‘If the move is not right, I’m not going’

Charlie Austin: ‘If the move is not right, I’m not going’

After hitting 18 goals in the Premier League last season, the QPR striker was the great non-deal of transfer deadline day. But he says he'd preferred another shot at promotion
Isis profits from destruction of antiquities by selling relics to dealers - and then blowing up the buildings they come from to conceal the evidence of looting

How Isis profits from destruction of antiquities

Robert Fisk on the terrorist group's manipulation of the market to increase the price of artefacts
Labour leadership: Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea

'If we lose touch we’ll end up with two decades of the Tories'

In an exclusive interview, Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea
Tunisia fears its Arab Spring could be reversed as the new regime becomes as intolerant of dissent as its predecessor

The Arab Spring reversed

Tunisian protesters fear that a new law will whitewash corrupt businessmen and officials, but they are finding that the new regime is becoming as intolerant of dissent as its predecessor
King Arthur: Legendary figure was real and lived most of his life in Strathclyde, academic claims

Academic claims King Arthur was real - and reveals where he lived

Dr Andrew Breeze says the legendary figure did exist – but was a general, not a king
Who is Oliver Bonas and how has he captured middle-class hearts?

Who is Oliver Bonas?

It's the first high-street store to pay its staff the living wage, and it saw out the recession in style
Earth has 'lost more than half its trees' since humans first started cutting them down

Axe-wielding Man fells half the world’s trees – leaving us just 422 each

However, the number of trees may be eight times higher than previously thought
60 years of Scalextric: Model cars are now stuffed with as much tech as real ones

60 years of Scalextric

Model cars are now stuffed with as much tech as real ones