NEW YORK — Pfizer on Sunday made a final offer valued at $118 billion for AstraZeneca. AstraZeneca, in turn, rejected the bid Monday morning.
"Even assuming that other key aspects of any proposal had been satisfactory, … the price at which the board of AstraZeneca would be prepared to provide a recommendation would have to be more than 10% above the level contained in Pfizer’s [latest] proposal," stated Leif Johansson, AstraZeneca chairman. "The final proposal is a minor improvement that continues to fall short of the board’s view of value and has been rejected.”
According to Pfizer's revised offer, AstraZeneca shareholders would receive, for each AstraZeneca share, 1.747 shares in the combined entity and 2,476 pence in cash, representing an indicative value of £55.00 per share (or approximately $92.60 per share). The revised offer represents an increase of approximately 15% over the value of Pfizer's May 2 proposal.
AstraZeneca's rejection may represent the end of the discussion. "Pfizer will not make a hostile offer directly to AstraZeneca shareholders and will only announce an offer with the recommendation of the AstraZeneca board," Pfizer stated Sunday.
“We believe our proposal is compelling for AstraZeneca's shareholders and that a Pfizer-AstraZeneca combination is in the best interests of all stakeholders," said Ian Read, Pfizer chairman and CEO. "We have tried repeatedly to engage in a constructive process with AstraZeneca to explore a combination of our two companies. Following a conversation with AstraZeneca earlier, … we do not believe that the AstraZeneca board is currently prepared to recommend a deal at a reasonable price. We remain ready to engage in a meaningful dialogue, but time for constructive engagement is running out. We have said from the beginning that we will remain disciplined in the price we are willing to pay, and we will not depart from that guiding principle. We believe that our proposal represents compelling and full value for AstraZeneca and that other issues that have been raised by AstraZeneca do not represent material difficulties.”
Sunday's offer represents the fourth proposal Pfizer has made.