Pfizer tries to allay fears over £63bn Astra bid

But Swedish finance minister warns over group's track record
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The Independent Online

The US pharmaceutical giant Pfizer has hit back at criticism of its £62.5bn bid for its rival AstraZeneca, promising its proposal would speed up the development of new drugs and "bolster innovative science".

The group – which has had two bids rejected by AstraZeneca – has come under attack from politicians, who have raised fears about jobs and the future of Britain's science industry if the largest ever foreign takeover of a UK company goes through.

In an infographic posted on its website, Pfizer said the deal would enable it to "seize new opportunities to expand our global research capabilities and partnerships to better serve patients in need".

The company also quoted the former GlaxoSmithKline chief executive, Sir Richard Sykes, who said that Pfizer had "first-class people doing first-class research".

AstraZeneca has so far rejected Pfizer's advances and on Tuesday Pascal Soriot, the company's chief executive, laid out his defence plan, promising that an independent AstraZeneca will nearly double its annual sales to more than $45bn (£27bn) by 2023, thanks largely to its pipeline of new medicines.

Mr Soriot said that process would be jeopardised by a takeover and added: "I have been through enough mergers to know a company is not a machine. It is a group of people. If you disrupt their work you can really have a negative impact very quickly."

The decision to reject Pfizer's bids has split shareholders, with some of the company's largest investors, including AXA Investment Managers and Schroders, calling for talks even though they believe the price is too low.

Others have backed the company, including Investor AB, which controls 4.1 per cent of AstraZeneca's shares. Sweden's finance minister Anders Borg has even waded into the debate, telling BBC Radio 4's Today programme that his country's experience of pledges from Pfizer had led him to be sceptical of the US firm.

"Our experience shows that their track record is not very convincing and I think one should take these kind of promises not only with a pinch of salt but a sackful of salt," Mr Borg said.

Analysts expect Pfizer to return with another sweetened bid. "We expect the recent flurry of noise coming from Government to provide relatively little of substance and expect a further bid to materialise in the coming weeks," said Savvas Neophytou at Panmure Gordon, who added that AstraZeneca's new projections imply a valuation of as much as £105 a share. "We have set out relatively conservative assumptions which should make a bid of £55 per share easily achievable for Pfizer," the analyst added.

AstraZeneca shares closed down 46.5p at 4,631p.

Meanwhile, at GlaxoSmithKline's annual general meeting yesterday, its chief executive, Sir Andrew Witty, told shareholders that GSK will continue to "watch as bystanders to see what happens with AstraZeneca".

He claimed the company "doesn't believe in big industry-transforming bids" because they can lead to "destructive consequences".