AstraZeneca shareholders demand justification for board’s instant rejection of Pfizer offer
Some of AstraZeneca’s biggest institutional investors are demanding an explanation of why the UK-listed company’s board rejected Pfizer’s latest takeover offer so quickly, The Times reported. Portfolio manager Richard Marwood of Axa Investment Managers was quoted stating that Astra’s shareholders should receive a detailed explanation of why Pfizer’s GBP 50 (EUR 60.82)-per-share approach yesterday, 2 May, was deemed to significantly undervalue the business.
Schroders fund manager Sue Noffke also said Astra’s directors should begin a dialogue with investors about the correct level for engagement, although she added that she remained unmoved by the GBP 63bn Pfizer offer, the item reported.
The report quoted Astra chief executive Pascal Soriot stating that Pfizer’s revised bid prompted “no debate” at a board meeting held yesterday and “everybody” quickly concluded that the cash-and-shares approach could not be entertained.
The Independent quoted an anonymous top-five Astra investor who said that although Pfizer’s most recent offer is too low, it is sufficiently serious to merit discussions between the two sides. A second unidentified shareholder concurred the bid is not high enough but added that the rejection came too quickly and there ought to have been a greater level of discussion prior to a decision, the report said.
The investors’ impatience may prompt New York-based Pfizer to go hostile, although this would likely hamper its plans for an inversion - relocating to the UK to benefit from lower tax charges and saving more than USD 1bn a year, the Times report said. People with close links to discussions expect another revised Pfizer offer to be made within days, the Independent reported.
The Financial Times quoted St James’s Place fund manager Neil Woodford in support of AstraZeneca’s stance; he said a deal would bring shareholders short-term profit but over the long term they would see greater benefits from remaining independent. St James’s Place owns an Astra stake worth GBP 350m, the report noted.
Source The Times (London), Independent, Financial Times