AstraZeneca Rejects Sweetened Pfizer Bid

NEW YORK (The Deal) -- The U.K.'s AstraZeneca (AZN) on Friday, May 2, took just a few hours to reject a sweetened takeover worth 63.1 billion pounds ($106.6 billion) from Pfizer (PFE), which sought support from U.K. Prime Minister David Cameron in a public letter as its furiously lobbying efforts continued.

The London target said late Friday morning that Pfizer's improved 5,000 pence-per-share proposal, up from its initial 4,661 pence pitch, was still way too low and didn't address its concerns that the bid was stock-heavy. The terms "are not a basis on which to engage with Pfizer," it said.

"AstraZeneca continues to invest significantly in research, development and manufacturing in the U.K., Sweden and the U.S. We are showing strong momentum as an independent company, in particular with our exciting, rapidly progressing pipeline, which the board believes will deliver significant value for shareholders," added Chairman Leif Johannson in the statement. "Pfizer's proposal would dramatically dilute AstraZeneca shareholders' exposure to our unique pipeline and would create risks around its delivery. As such, the board has no hesitation in rejecting the Proposal."

The New York pharmaceuticals giant's takeover attempt has already raised hackles among U.K. politicians fearing the loss of one of the country's biggest drug companies and Pfizer Chairman and CEO Ian Read has launched a charm offensive to win the government over. If Pfizer succeeds with its bid, the takeover would be by far the largest foreign takeover of a U.K. company and has prompted a debate about Britain's "open" takeover regime, which emerged largely intact following the furore surrounding the-then Kraft Foods Inc.'s 11.9 billion pound takeover of Cadbury plc in February 2010.

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