Seeking Alpha

Report: Pfizer tentatively offers to acquire AstraZeneca for £60B+

  • Pfizer (PFE) has tentatively approached AstraZeneca (AZN) about acquiring the British-Swedish company in a deal worth over £60B ($100.7B), the U.K's Sunday Times reports. The figure is well above AstraZeneca's market cap of £47.7B.
  • AstraZeneca has turned the offer down, although Pfizer could make a fresh proposal. A deal would be the largest ever foreign takeover of a British company.
  • Pfizer is looking to do something with a $70B cash pile that it has accumulated overseas; repatriating the money to the U.S. so it could be distributed to shareholders would land the company with a massive tax bill.
Comments (25)
  • Patent News
    , contributor
    Comments (1390) | Send Message
     
    very nice idea since do nothing congress won't act
    20 Apr 2014, 06:36 AM Reply Like
  • Rich in NJ
    , contributor
    Comments (39) | Send Message
     
    I think we will start seeing more of this type of use of cash that is "stranded" abroad.
    20 Apr 2014, 07:39 AM Reply Like
  • fatbaboon
    , contributor
    Comments (249) | Send Message
     
    jesus i hope this is wrong. azn's big drugs are in the process of disappearing. nexium, crestor.
    20 Apr 2014, 08:05 AM Reply Like
  • biochemist
    , contributor
    Comments (429) | Send Message
     
    AZN recently purchased the BMY portion of their joint venture for diabetes. PFE has been trying to move into diabetes drug development and this is one potential way to jump start the effort.
    20 Apr 2014, 11:11 AM Reply Like
  • fatbaboon
    , contributor
    Comments (249) | Send Message
     
    $100bn seems a bit steep to get in on a $8bn diabetes partnership.
    20 Apr 2014, 01:35 PM Reply Like
  • desertman
    , contributor
    Comments (19) | Send Message
     
    I'm quite sure Jesus has nothing to do with this.
    20 Apr 2014, 08:31 PM Reply Like
  • fatbaboon
    , contributor
    Comments (249) | Send Message
     
    it's easter - you think that's just a coincidence?
    21 Apr 2014, 03:57 AM Reply Like
  • Qniform
    , contributor
    Comments (2915) | Send Message
     
    I'm glad to address you by your handle, fatbaboon.
    22 Apr 2014, 12:21 PM Reply Like
  • CapeCapMgmt
    , contributor
    Comments (1242) | Send Message
     
    Wow, $100B......I suppose this is correct after doing a quick look at the EV for AZN.
    20 Apr 2014, 08:40 AM Reply Like
  • Scientist on Stocks
    , contributor
    Comments (251) | Send Message
     
    You know what.... Pfizer will be spending only what they earned from Lipitor !!
    20 Apr 2014, 09:42 AM Reply Like
  • Stocks4Dividends
    , contributor
    Comments (16) | Send Message
     
    Would be way better off buying Celgene...and could probably do it for 20 billion less...
    20 Apr 2014, 10:04 AM Reply Like
  • BioDoubt
    , contributor
    Comments (17) | Send Message
     
    Celgene is based in the U.S. so that wouldn't help with the overseas cash problem.
    20 Apr 2014, 11:06 AM Reply Like
  • jayhawkfan247
    , contributor
    Comments (96) | Send Message
     
    Could easily do a combo of issuing bonds, selling stock, using U.S. cash to acquire Celgene. Agree that Celgene is a good value here. However, the $20B number is WAY too low. Their market cap per Yahoo Finance today is $57B.
    20 Apr 2014, 06:19 PM Reply Like
  • Long Term Bio
    , contributor
    Comments (459) | Send Message
     
    I think Pfizer is grasping for something new, but they should look to small cap biotech stocks that are in phase 2. They could just buy out a whole bunch of those for much less. I guess Pfizer is just looking to improve their bottom line financials in the short term.
    20 Apr 2014, 11:36 AM Reply Like
  • Dr Joseph Haluska
    , contributor
    Comments (479) | Send Message
     
    A 21% premium is hard to turn down. I wonder what AZN's shareholders will think of this.
    20 Apr 2014, 11:44 AM Reply Like
  • A7E
    , contributor
    Comments (28) | Send Message
     
    I'm one. I'll take it. ;-)
    20 Apr 2014, 01:37 PM Reply Like
  • The Rebel
    , contributor
    Comments (1190) | Send Message
     
    Based on the quoted offer, it looks to be closer to a 30% premium. Those poor suckers who contributed to its 10% decline over the past 2 months must be kicking themselves, ha ha. Just a month ago JP Morgan downgraded AZN to underweight. Lastly, AZN last year trimmed its dividend by a nickel/year, a little over a penny a quarter, it's paid semi-annually in uneven amounts, and despite this negligible cut, rigid investors who bail at the slightest cut have also apparently lost out here.
    20 Apr 2014, 08:03 PM Reply Like
  • Jimghad
    , contributor
    Comments (214) | Send Message
     
    AZ has a powerful stream of products in Diabetes.
    They own Medimmune's Onco. line of products.
    AZ is now a very attractive Co. for the 2018 + pipeline.
    Great move on the part of Pfizer.
    Pfizer will off load the OTC division.
    Pfizer will have to get out of the Glifozin partnership with Merck.
    Pascal the CEO of AZ saved a sinking ship. Congrats Pascal.

     

    This should push up the price of BMS and Lilly as they will be the next big target.
    20 Apr 2014, 01:58 PM Reply Like
  • diwalipura
    , contributor
    Comments (3) | Send Message
     
    It is a good move so long as purchase price remains $70B or less.
    20 Apr 2014, 02:13 PM Reply Like
  • Paapaa
    , contributor
    Comments (43) | Send Message
     
    How did you conclude that the deal is good for Pfizer for price less than $70B? Why would it be bad at $75B? The amount of cash doesn't make the deal good or bad. Price does.
    21 Apr 2014, 09:37 AM Reply Like
  • Cash Flow Assets
    , contributor
    Comments (482) | Send Message
     
    Will the purchase be all in cash, or all stock or both some cash and stocks?
    20 Apr 2014, 02:33 PM Reply Like
  • idkmybffjill
    , contributor
    Comments (1705) | Send Message
     
    It'll likely be like the Wyeth acquisition. Lots of debt + cash. Maybe they'll use some stock too, who knows.
    20 Apr 2014, 06:17 PM Reply Like
  • Paapaa
    , contributor
    Comments (43) | Send Message
     
    There is no deal at the present: "AstraZeneca has turned the offer down, although Pfizer could make a fresh proposal."
    21 Apr 2014, 09:35 AM Reply Like
  • dentss
    , contributor
    Comments (9) | Send Message
     
    this is a very shrewd move on PFE's part ....why ? because it will be repatriating 75 billion dollars they are holding overseas without paying taxes on on penny ....
    20 Apr 2014, 08:39 PM Reply Like
  • Econ Student
    , contributor
    Comments (223) | Send Message
     
    100 Billion-That's awesome. Any deal this big gets people excited. Remember the Facebook IPO. Also coming is the Alibaba IPO. A bankers dream for sure.
    20 Apr 2014, 10:09 PM Reply Like
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