Pfizer still interested in AstraZeneca; could be interested in Actavis, other targets
Pfizer is not throwing in the towel on a takeover to slice its tax rate as well as acquire a pipeline of medications, though the possible cost of buying AstraZeneca is increasing, according to a newswire report.
Sources familiar with the matter told Bloomberg that Pfizer is considering other potential targets, such as Actavis Plc, while it can take initial steps next week on a renewed bid for AstraZeneca, based in London, the article reported. Pfizer abandoned its effort to purchase the London drugmaker for USD 116bn on 26 May, the article reported. The board of AstraZeneca turned down Pfizer's offers, regarding them as not high enough, Bloomberg reported.
Actavis, based in Dublin, has yearly sales of USD 8.677bn, according to Business OneSource.
The sources said Pfizer executives prefer to arrive at a deal to acquire AstraZeneca, and that US-based Pfizer is unlikely to move toward an alternative target in the near future, the article reported.
Confidence in AstraZeneca's experimental drug pipeline could embolden its board to seek a higher price, Helvea SA's Odile Rundquist told Bloomberg.
Rules in the United Kingdom require that hopeful acquirers who abandon bids must usually wait six months prior to offering a renewed approach, which would put the end of Pfizer's waiting period at 26 November, the article reported. After three months, though, a target can ask a bidder to re-enter discussions, which is seen as unlikely in this case, considering the earlier rejections from AstraZeneca, the article reported. Bloomberg reported that in May, AstraZeneca told Pfizer an offer would need to be GBP 58.85 per share; the final proposal from Pfizer was GBP 55 per share.
A Reuters report said that AstaZeneca shares have gained over 7% this week amid speculation Pfizer could return following its failed GBP 71bn takeover bid in the spring. At the end of a longer piece about the possible tie-up, the newswire said analysts at Berenberg believe the US drug company could even target GlaxoSmithKline (GSK), AstraZeneca's larger UK competitor.
GSK has a market cap of GBP 68.9bn. AstaZeneca's stands at about GBP 54bn