Now that the deadline for any quick deal to acquire AstraZeneca has passed, about the only certainty to emerge from the wrecked takeover is that the last thing Pfizer can do now is go back to business as usual.
With the official deadline for any immediate takeover discussions looming on Monday, Pfizer picked up its ball and bat and headed for the lockers, officially calling an end to its odd quest to buy out AstraZeneca.
Four times Pfizer has made offers to buy AstraZeneca and four times, the U.K. company has said no. But the world's largest money-management firm hopes in this case no doesn't mean no. BlackRock--which owns 8% of AstraZeneca and 6.8% of Pfizer--is encouraging discussions between the two companies, according to Bloomberg, which cited anonymous sources.
In the latest EuroBiotech Report, while critics of Pfizer's attempt to buy AstraZeneca spent the week celebrating a major blow to the deal, an awkward question remains: Exactly what has been "saved" from Pfizer's clutches? And more.
It's not over yet. Another one of AstraZeneca's big investors appears to have joined the rebel group demanding that the board get to the bargaining table and see where it can take Pfizer's latest $120 billion offer. Citing sources, The Wall Street Journal reports that Legal & General, AstraZeneca's 6 th largest shareholder with a 3.5% stake in the company, wrote a letter to the board telling them they should engage in takeover talks.
So, Pfizer. What's Plan B? That's what investors are asking, now that CEO Ian Read's $117 billion bid for AstraZeneca hit a wall--and the promised trifecta of lower taxes, cost savings and promising drugs along with it.
Now that AstraZeneca's board has nixed Pfizer's "final" offer, the proposed $119 billion megamerger would seem to be all but dead. Pfizer's already given up the option of going hostile, which is easier in the U.K. than it is in the U.S. And British M&A rules prevent Pfizer from topping a final bid. But signs of investor unrest have begun to surface at AstraZeneca. And the rebels may hold the only key to restarting controversial negotiations.
Analysts have pointed out the change from "significantly undervalues" to "undervalues," and the absence of the word "unanimous" from the AstraZeneca board's official rebuff of Pfizer's latest offer. The media is polling top AstraZeneca shareholders, looking for hints about which might push for deal--and how hard.
In the old days, back in April, the big news everyone was waiting for from Pfizer was whether it would go ahead and file for FDA approval of its star pipeline drug palbociclib on Phase II data alone. The answer, signaled by the rolling of the drums Friday as trading in Pfizer's shares was momentarily suspended, was yes. But as Pfizer had recently shifted the primary focus to its wholly unexpected megamerger bid for AstraZeneca, the response from investors was somewhat underwhelming.
AstraZeneca Chairman Leif Johansson condemned the tax inversion scheme at the heart of the proposal--along with the cost-cutting that would have followed the megamerger--and confidently chose to gamble the company's future on its new and expanded pipeline.