Pfizer upped its offer to purchase AstraZeneca Plc once again, this time to $119 billion. Pfizer calls this their final attempt, and has set a deadline of May 26th for the company to respond, but AstraZeneca did not need that long to reply, issuing a statement this morning that they are rejecting the offer.
The latest offer is cash and stock, valuing AZN at £55 a share, 45 percent of which could be paid cash. (AZN is based in London.) The previous offer (May 2) was £50 pounds a share. The new offer is 10 percent higher than the last, and 53 percent above AZN's January 3 closing price (before Pfizer's first offer.) AZN said £55 per share "undervalues" the company, and was only a "minor improvement" from the last offer. The AstraZeneca board says it will only consider bids over £58.85 per share.
Pfizer was not hopeful going into the deal, as they did not expect AZN to accept the cash/stock deal, that would have created the world's largest pharmaceutical company. They had said it would be the last of the current bidding process, and that they would not make a "hostile" offer directly to AZN shareholders.
Pfizer CEO Ian Read issued this statement, “We have tried repeatedly to engage in a constructive process with AstraZeneca. Following a conversation with AstraZeneca earlier today, we do not believe that the AstraZeneca board is currently prepared to recommend a deal at a reasonable price. We remain ready to engage in a meaningful dialogue, but time for constructive engagement is running out.” As of today's rejection, time is out.