Asset managers among the leading AstraZeneca shareholders include Legal & General Investment Management, Scottish Widows Investment Partnership, BlackRock, Invesco Asset Management, Capital Research & Management Co, Wellington Management, Schroder Investment Management and the Vanguard Group.
The raised proposal implies a 32% premium but has been widely expected, and AstraZeneca shares have fallen slightly on the news to £47.97. The £50 for each share would be formed by 1.845 shares in the newly combined company and £15.98 in cash. The offer is conditional on due diligence and the support of the AstraZeneca board and directors.
Pfizer’s letter to Cameron sets out its rationale for the deal and attempts to offer reassurance that Britain’s interests would not be harmed. It says there is a ‘compelling industrial logic’ for the two companies to merge and committed to maintain a major presence in the UK.
Pfizer promised to make the merged company’s corporate and tax residence the UK, complete the construction of the proposed AstraZeneca Cambridge campus, base ‘key scientific leadership’ in Cambridge, carry out some of its manufacturing in the UK and base at least 20% of its R&D staff in there.
"We have seen significant positive market reaction to the announcement we made on April 28, including from the shareholders of both our companies,” said Pfizer CEO Ian Read.” The consistent message we have heard reinforces our belief that there is a highly compelling strategic, business and financial rationale for combining our businesses, with significant benefits for shareholders and stakeholders of both companies,” he added.
Following a board meeting, AstraZeneca rebuffed the new proposal saying it is inadequate, substantially undervalues the company and provides no basis to engage with Pfizer.