LONDON, July 13 Britain plans to force foreign
buyers of major British companies to make binding commitments on
issues that are in the national interest such as investment in
research, Business Secretary Vince Cable said on Sunday.
This issue was raised earlier this year when U.S. drugmaker
Pfizer tried to take over Britain's AstraZeneca,
prompting fears it would lead to cuts in UK science jobs and
"What the government did then was to engage in negotiations
to seek assurances. Where we now have to strengthen that is to
make sure that where commitments are made, there is no wiggle
room," Cable told the BBC's Andrew Marr show.
Pfizer gave a five-year commitment to complete AstraZeneca's
new research centre in Cambridge, retain a factory in northern
England and put a fifth of its research staff in Britain, but
said these pledges could be adjusted if circumstances changed
In 2010, U.S. foods group Kraft, which made a
successful bid for British rival Cadbury, had promised to keep
one of Cadbury's factories open, only to go back on the pledge
soon after the deal was completed.
Cable said the government was discussing its options with
the Takeover Panel, which oversees mergers and takeovers
involving British companies.
"We may well get into the area of having financial penalties
in order to make sure those commitments are binding ... There is
wiggle room in the existing rules and we want to deal with it in
such a way that there is no escape from it," he said.
Cable said it was likely the law would need to be changed to
enforce such commitments, but new legislation could be
introduced quickly as there was agreement across government
about the need for such measures.
Cable said his Liberal Democrat party, the government's
junior coalition partner, believed that a second measure also
needed to be introduced to deal with cases where companies are
not willing to make such assurances.
"You then need some fall back powers, you need a last resort
where the government can intervene, can invoke the public
interest," he said.
Currently, a formal public interest test which gives
politicians the power to intervene in corporate deals only
applies to areas such as media plurality and financial
(Reporting by Kylie MacLellan. Editing by Jane Merriman)