Pfizer’s £69bn failed bid for Astrazeneca has drawn several parallels with Kraft’s successful purchase of Cadbury, one of them being that it pitted the same two financial companies, heavyweights Brunswick and RLM Finsbury, against one another.
If one could judge a campaign by the victor in a takeover battle, then ostensibly Brunswick, which was advising Kraft, won the first skirmish and RLM Finsbury, Astrazeneca’s adviser, is likely to win the second by virtue of the fact that its clients appears likely, though not certain, to remain independent. Things are rarely so simple, though. It is almost impossible to judge who the winners and losers are after such events.
Some Astrazeneca shareholders, for example Schroders, Legal & General and Axa, are ruing the board’s decision to reject a £55-a- share offer from a rival, especially when they look at the group’s current deflated share price now most people believe a deal is dead.
Those who have advised the Astrazeneca board may have helped keep the company independent, but have they succeeded in what is best for shareholders, for employees or for drug development more generally? Only time will tell.
What is clear from recent events is that the bid battle has energised RLM founder Roland Rudd, who has evidently been loving being at the centre of a tussle that has aroused strong feelings from politicians, the City, scientists and, of course, the media. Nobody knows three of these groups as well as Rudd and somehow during the course of the battle he became acquainted with the scientists, too.
As he sped down the A3 on Saturday night to a charity function he was in part hosting (and very late for), Rudd was in the thick of it, much more so than his direct rival, Sir Alan Parker.
Parker, the Brunswick founder and chairman, may have helped Pfizer’s Ian Read to begin talks with Prime Minister David Cameron at the beginning of the bid battle. For a time, this strategy seemed to be working. But Parker’s continuing involvement doesn’t seem to have been as high tempo as Rudd.
Brunswick’s bid team was led by London partners Richard Jacques and Justine McIlroy with Parker playing a much more behind the scenes role.
When Rudd found there had been a letter written to David Cameron in which Pfizer had made assurances over jobs and investment, he called Sir Jeremy Heywood in the Cabinet Office and complained that the government was acting as a Pfizer cheerleader. The call was a masterstroke, having the effect of turning the government’s position to being at best neutral, even interventionist.
In the proceeding days, politicians, scientists, even investors such as Martin Gilbert of Aberdeen Asset Management and the prominent fund manager Neil Woodford, came out openly to back Astrazeneca’s strategy of being independent. They were all helped to do so by RLM Finsbury, who were promoting the words of support to all who would project them.
By Monday, after an all-nighter on Sunday evening, Rudd’s elation at putting one over his rival was there for all to see at the Chelsea Flower Show. He has told friends that protecting Astrazeneca’s independence was the most important thing he had done in 20 years, so strongly did he feel about the merits of the case. Shareholders might wait to see the evidence from the company’s pipeline of drugs before passing their own judgement on the matter.