* Pfizer may delay any new bid until after meeting UK
* State governors worried about losing American jobs
* Any Pfizer promises must be "ones that will stick" - Clegg
* Collapse of ad agency merger a different case - source
By Ben Hirschler
LONDON, May 9 U.S. drugmaker Pfizer is
under fire on both sides of the Atlantic as it weighs its next
move to buy British rival AstraZeneca, which could be a
sweetened offer next week.
A strategic question for Pfizer and its advisers is whether
to come back with a new bid before bosses from both companies
are grilled by UK lawmakers on May 13-14, or wait until the end
of the week.
Two people familiar with the matter said on Friday it would
be more "polite" for Pfizer to explain its current position to
the two parliamentary committees before pushing out a new offer.
The New York-based company's record of slashing jobs after a
string of earlier mergers has provoked a political backlash
against the proposed $106 billion takeover at home and in
Britain, with two U.S. state governors joining the fray on
Maryland Governor Martin O'Malley and Delaware Governor Jack
Markell wrote to Pfizer Chief Executive Officer Ian Read
"expressing deep concerns" about the planned deal, given the
fact that AstraZeneca employs 5,700 people in the two states.
Many in the United States fear Pfizer's promise to Britain
that the combined company would keep 20 percent of its research
and development workforce in the country will inevitably
jeopardise American jobs.
It is the same fear that agitates politicians in Sweden,
where Prime Minister Fredrik Reinfeldt said his country had
already had "negative experiences" with Pfizer after it failed
to honour promises on jobs following its 2002 acquisition of
In Britain, however, there are concerns that Pfizer's vows
leave too much room for it to renege on its promises, and Prime
Minister David Cameron, who initially welcomed Pfizer's "robust"
assurances, now wants more commitments.
Deputy Prime Minister Nick Clegg said on Friday that the
government needed to be confident about any such promises. "Our
focus is to make sure that, if the companies decide to proceed,
the commitments ... are serious ones, are durable ones, and are
ones that will stick," he said at a Reuters newsmaker event in
There is also growing disquiet about Pfizer's desire to
reincorporate in Britain to cut its tax bill, with U.S.
Democratic senators weighing legislation to prevent such tax
AstraZeneca has rejected successive approaches from its
larger American rival and Chief Executive Pascal Soriot is now
on a roadshow with advisers to meet dozens of leading investors
and lay out his strategy for a prosperous independent future.
Soriot has secured the backing of several high-profile
shareholders but others have told Reuters they would like him to
engage with Pfizer if the U.S. group makes an improved offer.
Shares in AstraZeneca, which rallied nearly 2 percent on
Thursday on talk that an improved bid might be imminent, fell
back 1.8 percent on Friday afternoon.
"I can't see there being much movement from these levels
until there's more clarity on Pfizer's intentions," said Central
Markets trading analyst Joe Neighbour.
The collapse of a $35 billion merger between advertising
giants Omnicom and Publicis has added some
uncertainty around the proposed giant pharmaceutical deal.
The Omnicom-Publicis tie-up would also have involved an
advantageous change of tax residence but faced a series of
problems, including anti-trust hurdles in China, which may also
The deals are, however, fundamentally different. The two ad
agencies sought a merger of equals, leading to feuding over top
executive roles, while Pfizer's move on AstraZeneca would be a
"People will look for links but the reality is there isn't
any real read-across on points of substance," said one person
familiar with Pfizer's thinking. "Large mergers are difficult
but every deal of this size brings its own issues."
(Additional reporting by Sudip Kar-Gupta, Guy Faulconbridge and
William James; editing by David Stamp)