NEWS OF TH E WEEK
“disappointed by the company’s summary rejection,” he added. The $119 billion bid represented a 53% premium to AstraZeneca’s stock price in early January. The British firm’s share price quickly fell about 11% last week on news that the offer was turned down. Pfizer began pursuing AstraZeneca in January with a ACQUISITION: Deal not sweet $100 billion bid. Since the end of April, it ramped up its enough to make British firm bend efforts through higher bids, appearances before British parliamentary committees, and appeals to lawmakers and shareholders. Pfizer CEO Ian C. Read has been on STRAZENECA’S management has rejected a campaign to provide assurances that the merger was Pfizer’s fourth and presumably final takeover good for science and would not negatively impact Asoffer, this one valued at $119 billion. traZeneca’s R&D operations. “We have rejected Pfizer’s final proposal because it However, AstraZeneca was eager to point out that a is inadequate and would present significant risks for main driver of a merger would have been to move Pfizshareholders, while also having serious er’s domicile from the U.S. to the U.K. and consequences for the company, our embenefit from reduced tax rates. “Pfizer’s apployees, and the life sciences sector in the proach throughout its pursuit of AstraZenU.K., Sweden, and the U.S.,” AstraZeneca eca appears to have been fundamentally Chairman Leif V. Johansson said. Even if driven by the corporate financial benefits key concerns around a merger had been to its shareholders of cost savings and tax satisfactorily addressed, he added, Astraminimization,” Johansson said. “Pfizer has Zeneca’s board wanted to see an offer of failed to make a compelling strategic, busimore than $127 billion before it would conness, or value case.” sider recommending it to shareholders. As Pfizer pursued AstraZeneca, U.S. The rejection seems to end a takeover lawmakers started to respond to the posaga that has been gripping the drug industential “inversion,” or switching of tax try for weeks. In a letter to AstraZeneca, headquarters. On May 20, Sen. Carl Levin Pfizer indicated that its proposal “is final (D-Mich.) and 13 other Democratic sena—LEIF V. JOHANSSON, and cannot be increased.” It also said it will tors introduced a bill to prevent companies ASTRAZENECA not make a hostile offer directly to AstraCHAIRMAN from moving offshore, at least on paper, Zeneca shareholders. while maintaining operations in the U.S. Owing to the vagaries of British takeover law, AstraCompanion legislation is expected in the House of RepZeneca has largely shut down the process, at least for resentatives. six months, unless its board has a last-minute change “The Pfizer-AstraZeneca deal is just the latest examof mind. And that would take significant shareholder ple of abusive inversion deals,” Levin said when intropressure, because the board appears “inflexible,” Leerducing the bill. If Pfizer’s inversion succeeded, he said, ink stock analyst Seamus Fernandez pointed out in a it would have cost the U.S. about $1 billion in annual tax report. That said, a number of large investors have been revenue.—ANN THAYER
ASTRAZENECA
ASTRAZENECA REJECTS PFIZER’S FINAL OFFER
A
Johansson PFIZER
“Pfizer has failed to make a compelling strategic, business, or value case.”
Read
STATE OF SCIENCE An online resource from the National Science Board lets the public explore data on science and engineering in each state. One example is this map, which ranks each state by the percentage of science and engineering graduates at all levels it produced in 2011.—AW KEY
NOTE: Percentage of science and engineering degrees of all bachelor’s, master’s, and doctoral degrees awarded in 2011. SOURCE: National Science Board
(% range for each quarter)
■ Top quarter (32.2–40.8%) ■ 2nd quarter (28.5–32.1%) ■ 3rd quarter (26.1–28.4%) ■ Bottom quarter (20.4–26.0%)
CEN.ACS.ORG
9
MAY 26, 2014
)
