Pfizer’s intentions on AstraZeneca involve the playing of a high stakes strategic chess game, with each side plotting carefully their next move. Pfizer has until May 26th to make a firm bid on AstraZeneca or walk away and with the episode in the public eye, it will be interesting to see what moves each company makes in the next few weeks.
AstraZeneca has so far rejected the advances of Pfizer, however the US drugmaker has been pursuing its UK rival for quite some time now and it would appear that two rejections has done little to reduce its fervor to push for another mega-merger. The impasse as it currently stands could set the stage for a corporate showdown, but what are the reasons behind the move?
The move could be a combination of factors, from market access to acquiring pipelines, however financial motivation seems to be appearing quite significantly on the radar. As reported in the Financial Times if Pfizer were to acquire AstraZeneca, then they could switch their tax registration to the UK from the US, with Pfizer keeping a New York listing, meaning that they could circumvent UK corporate governance rules. Therefore resulting in huge financial benefits. The political implications of this move however could also be considerable, given that AstraZeneca’s “£7 billion of drugs sold every year account for a whopping 2.3% of British good exports”, as reported by Linda Yueh, the BBC’s chief business correspondent. We are yet to see the political players moving to take up their chess positions, however I am sure it will be soon.
I will be blogging on the developments as they happen, so keep checking back to find out how this deal is progressing and whether AstraZeneca succumbs to the mighty power of Pfizer, or if Pfizer actually makes a bid on the company. This game of chess is heating up and who will come out on top is undecided.
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