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| AstraZeneca rejects new Pfizer bid | AstraZeneca rejects new Pfizer bid |
| (35 minutes later) | |
| UK drugs company AstraZeneca has rejected an improved "final" takeover offer from US drugs giant Pfizer. | UK drugs company AstraZeneca has rejected an improved "final" takeover offer from US drugs giant Pfizer. |
| Pfizer had made a new offer of £55 per share, valuing AstraZeneca at about £69bn. | Pfizer had made a new offer of £55 per share, valuing AstraZeneca at about £69bn. |
| But AstraZeneca says the new proposal "undervalues the company and its attractive prospects". | But AstraZeneca says the new proposal "undervalues the company and its attractive prospects". |
| Pfizer's pursuit has been under scrutiny because of fears it would hamper AstraZeneca's drug research and cut jobs. | Pfizer's pursuit has been under scrutiny because of fears it would hamper AstraZeneca's drug research and cut jobs. |
| Controversial deal | |
| Pfizer planned to create the world's largest drug company, with its headquarters in New York, but based in the UK for tax purposes. | Pfizer planned to create the world's largest drug company, with its headquarters in New York, but based in the UK for tax purposes. |
| In a strategy known as "tax inversion" Pfizer could pay the UK corporate tax rate of 20%, rather than the 35% rate applied in the US, if it bought AstraZeneca. | In a strategy known as "tax inversion" Pfizer could pay the UK corporate tax rate of 20%, rather than the 35% rate applied in the US, if it bought AstraZeneca. |
| That plan has proved controversial with unions and politicians, with AstraZeneca employing 6,700 people in the UK. | That plan has proved controversial with unions and politicians, with AstraZeneca employing 6,700 people in the UK. |
| AstraZeneca chairman Leif Johansson said Pfizer's pursuit had been "fundamentally driven" by the corporate financial benefits. | AstraZeneca chairman Leif Johansson said Pfizer's pursuit had been "fundamentally driven" by the corporate financial benefits. |
| "Pfizer has failed to make a compelling strategic, business or value case," he added. | "Pfizer has failed to make a compelling strategic, business or value case," he added. |
| Of the two companies' research and development workforce, Pfizer has said it will retain at least 20% in the UK for at least five years. It has also pledged to base its European HQ in Britain. | |
| AstraZeneca's shares fell over 13% in early trading after its rejection of the offer. | |
| In its new offer statement, Pfizer chief executive Ian Read said: "We stand by our unprecedented commitments to the UK government." | In its new offer statement, Pfizer chief executive Ian Read said: "We stand by our unprecedented commitments to the UK government." |
| Pfizer had said that its improved offer of £55 per share was "final" and would not be increased. | Pfizer had said that its improved offer of £55 per share was "final" and would not be increased. |
| AstraZeneca shareholders were being offered £24.76 in cash and 1.747 shares in the new firm - worth a combined £55 - for each share currently they hold. | AstraZeneca shareholders were being offered £24.76 in cash and 1.747 shares in the new firm - worth a combined £55 - for each share currently they hold. |
| Pfizer had also promised not to mount a hostile takeover - a direct approach to shareholders of AstraZeneca without the involvement of its board. | Pfizer had also promised not to mount a hostile takeover - a direct approach to shareholders of AstraZeneca without the involvement of its board. |
| Mr Johansson said that he had made clear to Pfizer that his board could only recommend a bid that was at least 10% above an offer of £53.50 made by Pfizer on Friday. | |
| He told Radio 4's Today programme that AstraZeneca had rejected Pfizer's offer for three reasons - that it could create better value for shareholders independently, that a takeover would limit its ability to get drugs to market quickly and that the deal carried a "big execution risk". | |
| "It's obviously a controversial deal," he added. |