London/New York: Pfizer abandoned its attempt to buy AstraZeneca for nearly £70 billion ($118 billion) on Monday as a deadline approached without a last-minute change of heart by the British drugmaker. The decision ends a month-long public fight between two of the world’s biggest pharmaceutical companies that sparked political concerns on both sides of Atlantic over jobs and corporate tax maneuvers. British rules now require an enforced cooling-off period.
AstraZeneca could reach out to Pfizer after three months and Pfizer could take another run at its smaller British rival in six months time, whether it is invited back or not. Pfizer’s move came two hours before a 5.00 pm (1200 ET) deadline to make a firm offer or walk away, under UK takeover rules. Its decision to quit the stage, at least for now, had been widely expected after AstraZeneca refused its final offer of £55 per share.
“Following the Astra-Zeneca board’s rejection of the proposal, Pfizer announces that it does not intend to make an offer for AstraZeneca,” Pfizer said in a short news release. The biggest US drugmaker promised it would not go hostile by taking its offer directly to AstraZeneca shareholders, leaving the fate of what would have been the world’s largest ever drugs merger in the hands of its target, whose board would have had to make a complete U-turn to get a deal done.
“We continue to believe that our final proposal was compelling and represented full value for AstraZeneca based on the information that was available to us,” said Ian Read, Pfizer’s chairman and chief executive.
Pfizer’s final offer was at a price that many analysts and investors had previously suggested would bring AstraZeneca to the table for serious negotiations. But in rejecting an earlier offer of £53.50 as undervaluing the company, the British group indicated it needed a bid more than 10 percent higher, or at least £58.85 per share, for its board to consider a recommendation. Pfizer had urged Astra-Zeneca shareholders to agitate for engagement and many expressed disappointment at its intransigence, although others backed the firm’s standalone strategy.
