| LONDON, April 29
LONDON, April 29 Pfizer Chief Executive
Ian Read flew into London on Tuesday to pitch his planned $100
billion takeover of rival British drugmaker AstraZeneca
to government ministers and urge them not to obstruct the deal.
The British government has so far adopted a neutral stance
on the matter - in part because Pfizer has yet to make a firm
bid - but behind the scenes officials are warning Pfizer against
making draconian research job cuts, industry sources said.
A spokesman for the U.S. company said Read was meeting a
number of key "stakeholders" in Britain, but declined to give
One person familiar with the situation said Read's agenda on
Tuesday had included a visit to the Treasury, or finance
Finance Minister George Osborne has said any deal between
Pfizer and AstraZeneca would be a "commercial matter between the
companies", but he stressed the importance of science to Britain
during a television interview on Tuesday.
"I want to see more British science," Osborne said.
Read, who studied chemical engineering in London in the
early 1970s, knows he is stepping into politically dangerous
territory with a deal that is designed to generate both big cost
savings and lower tax bills.
Unions, the opposition Labour party and some scientists have
already raised the alarm about a potential Pfizer takeover of
Britain's second-biggest drugmaker, which employs nearly 7,000
people in Britain.
Read, however, said it would be a mistake for Britain to go
down an interventionist path by trying to block the deal.
"The UK faces a choice," he told the Financial Times in an
interview. "Do they focus on ensuring there is an educated
workforce with the right incentives in place to attract
investment or do they pick winners and losers."
Buying AstraZeneca would be the biggest ever foreign
acquisition of a British company.
Pfizer insists it views Britain as an attractive location
for both pharmaceutical research and manufacturing - helped by
recent government tax incentives - but that it cannot make any
firm commitments on future investment or jobs.
Pfizer already has a tarnished reputation in the eyes of
some scientists after shuttering a large drug research site in
Sandwich, southern England, where Viagra was invented with the
loss of nearly 2,000 jobs three years ago.
The U.S. drugs giant also faces political headwinds on the
other side of the Atlantic, where U.S. politicians are unhappy
about its plans to move its tax base to Britain.
Pfizer's plan to merge the two companies into a UK holding
company, while maintaining its operational headquarters in New
York, would likely be the largest deal ever done that included
such a so-called tax "inversion."
On the financial front, meanwhile, investors believe Pfizer
will need to raise its suggested bid for AstraZeneca to more
than $105 billion and increase the proportion of cash in the
offer to win its prize.
(Editing by Erica Billingham)