Pfizer confirms offer hike for AstraZeneca as it argues case to the PM

 
Guy Bentley
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Pfizer has upped its offer for UK drugs giant AstraZeneca by £3bn and has sent a letter to Prime Minister David Cameron outlining the benefits of such a deal.

The drug company's improved offer amounts to £50 per share.

Pfizer confirmed that should the deal go ahead it would establish corporate and tax residency in Britain.

The company also reassured the Prime Minister that a minimum of 20 per cent of the combined company's research and development workforce would be employed in the UK.

Pfizer said in a statement:

  • Proposal represents a substantial premium of 32 per cent for AstraZeneca shareholders.
  • Proposal represents a 39 per cent premium to the closing price of £35.86 on 3 January 2014, being the trading day immediately prior to the date of Pfizer's January proposal
  • AstraZeneca shareholders would receive, for each AstraZeneca share, 1.845 shares in the combined company and 1,598 pence in cash, representing an indicative value of £50.00 ($84.47) per share

Pfizer boss Ian Read and its top brass jetted into the UK on Tuesday for a whirlwind charm offensive, meeting chancellor George Osborne, business ministers and City fund managers owning shares in AstraZeneca.

The FTSE 100 giant employs about 6,700 people of its 50,500 workforce in the UK. Speaking about the possibility of a deal, conservative peer Lord Hestletine told the BBC, "there are so many issues about the science base, about the supply chains, about employment prospects that ought to be explored and I don't see any way in which this can be adequately done unless the government has reserve powers."

The comments echo concerns voiced by the Labour party and others over the safety of British jobs and industry. However, the remarks may raise fears that a deal could be put in danger due to government intereference.

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