AstraZeneca shares slide after Pfizer drops takeover bid
Tuesday 27 May 2014
Shares in AstraZeneca shares fell in early London trading as the City warned it was unlikely that Pfizer will return with a renewed deal this year.
The US maker of Viagra walked away from its controversial £55-a-share offer last night as the takeover deadline approached without a change of heart from AstraZeneca.
Pfizer had promised it would not go hostile by taking its bid directly to its rival’s shareholders, even though some of its largest institutional shareholders wanted it to start talks.
Analysts said any future tie-up between the two companies was now likely to be at a lower price, hitting AstraZeneca’s shares, which fell 2 per cent to £42.46.
UK takeover rules mean although AstraZeneca can reach out to Pfizer in three months’ time, Pfizer cannot make an unsolicited bid for six months. Ian Read, Pfizer’s chief executive, yesterday described the Takeover Code as being “overly complicated” and “overly bureaucratic”.
Savvas Neophytou, analyst at Panmure Gordon, lowered his target on the shares from £54 to £44. He said: “With tax inversion, a key component of Pfizer’s generous offer of £55, likely to be removed by the US government, we are not expecting an offer of that size again.”
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