Pfizer confirms interest in a possible merger with AstraZeneca

28th Apr 2014 08:25

On Monday US pharmaceuticals group Pfizer confirmed prior discussions with AstraZeneca regarding a "possible combination" and its continuing interest in a possible merger. Pfizer's previous proposal to the board of AstraZeneca on January 5th 2014 included a mix of cash and shares in the combined entity which represented an indicative value of £46.61 ($76.62) per AstraZeneca share. That amounted to a "substantial premium" of approximately 30% to AstraZeneca's closing share price of £35.86 on January 3rd, the American outfit said. "As in its previous proposal, Pfizer is considering a possible transaction in which AstraZeneca shareholders would receive a significant premium for their AstraZeneca shares, to be paid in a combination of cash and shares in the combined entity," Pfizer added. However, the US firm also reserved the right to lower its bid from the equivalent of £46.61 ($76.62) for each AstraZeneca share should certain conditions be met, including a lower bid than the above from a rival before Pfizer announces a firm intention to pursue an acquisition or should the British outfit declare a dividend in excess of the 53.6p now expected by analysts to be paid out on July 31st. As of 08:15 shares of AstraZeneca were vaulting higher by 12.75% to 4,600p. AB