AstraZeneca Boss Says No Deal Before Deadline
The boss of AstraZeneca said there was no prospect of a deal with US drug giant Pfizer before a set deadline of May 26.
Chairman Leif Johansson also said there was no likelihood of a deadline extension, under rules laid down by the Takeover Panel.
Mr Johansson said that it was Pfizer, not AstraZeneca, that called an end to discussions on Sunday afternoon about a potential takeover to create the world's largest drug maker.
Early Monday morning AstraZeneca announced a rejection of Pfizer's "final offer" takeover bid, which valued the company at £69.3bn ($119bn).
The British drug firm said the offer of £55 a share falls short of its value as an independent company and that its larger US rival had failed to "make a compelling strategic business or value case".
It said the Pfizer proposals would bring "uncertainty and risks" for AstraZeneca shareholders.
Mr Johansson told Sky News: "We rejected the bid on three grounds. First, we think it undervalues the opportunities we think AstraZeneca could have as an independent company.
"Secondly, we think there is a long, drawn-out process, with very considerable execution risk ... and thirdly, we think there is a clearly disruptive element in how we can best create value for shareholders and society by disrupting the way we get medicines to the market."
On Sunday, Pfizer told AstraZeneca it had until 5pm on May 26 to make a decision.
Mr Johansson said he had had made it clear that his board could only recommend a bid that was at least 10% above an offer of £53.50 made by Pfizer on Friday evening.
AstraZeneca shares plunged by more than 14% in early Monday trading, driving its market value down to £52.1bn, £17bn less than the value Pfizer had put on the company.
On May 2, New York-based Pfizer made an offer of £63bn ($106bn) for AstraZeneca, which the board rejected "without hesitation".
Investors backed AstraZeneca in rejecting the cash-and-stock approach worth £50 a share, but many said they would want it to engage if Pfizer came back with an improved offer.
Pfizer has said it will not make a hostile offer directly to AstraZeneca shareholders, and would only proceed with an offer with the recommendation of AstraZeneca's board.
Sky News City Editor Mark Kleinman said: "The AstraZeneca board has highlighted the inherent risks in doing a deal with Pfizer at any price - the risk to jobs that would be triggered from a merger of this kind.
"But unusually in AstraZeneca's statement, it has put a price tag on itself ... it says it would only be prepared to make a recommendation to shareholders if the board of Pfizer were to make an offer that was at least 10% above the £53.50 per share that was made privately on Friday.
"That would put a price tag on AstraZeneca of about £59 a share - well over £70bn."
The latest rejected bid increased the cash element to 45%, with AstraZeneca shareholders set to receive 1.747 shares in the enlarged company for each of their AstraZeneca shares and 2.476p in cash.
Pfizer wants to create the world's largest drugs company, with its headquarters in New York and a tax base in Britain.