U.K. Lawmakers Seek Ways to Challenge Pfizer Move on AstraZenecaRobert Hutton and Kitty Donaldson
British lawmakers mobilized against Pfizer Inc.’s attempt to buy AstraZeneca Plc, demanding Business Secretary Vince Cable secure assurances on jobs and research investment.
Adrian Bailey, chairman of Parliament’s cross-party Business Committee, said April 29 it is likely to summon Pfizer executives to give evidence on their intentions. Yesterday, Julian Huppert, from Cable’s junior coalition Liberal Democrat Party, submitted a motion calling for ministers to “act as necessary to protect employment and skills in the U.K.”
Prime Minister David Cameron has in the past praised Britain’s open economy, suggesting he would be reluctant to intervene in the proposed $99 billion deal. Still, the government has mechanisms by which it could try to prevent a takeover. Pressure from Parliament and Liberal Democrats in the government could make that more likely.
“There is a great deal at stake here,” Huppert said in a statement. “This would be the largest takeover of a British firm. I want to make sure AstraZeneca retains its position in the U.K. It is extremely important for those people employed by the company and our economy generally.”
Pfizer Chief Executive Officer Ian Read met with U.K. government ministers April 29 to discuss a potential takeover, according to a person familiar with the meetings. Read emphasized the American company’s plans to carry out research, development and manufacturing in the U.K. as well as the appeal of the British tax system, the person said.
Pfizer’s reputation in Parliament isn’t helped by its 2011 decision to close a research hub in the coastal town of Sandwich, southeast England, with the loss of 2,000 jobs. AstraZeneca is moving to a new global headquarters and research center in Cambridge, which is represented by Huppert.
“AstraZeneca is a jewel in the crown in the pharmaceutical sector and a foreign takeover is really concerning,” a member of the Business Committee and opposition Labour lawmaker, said in an interview. Cable “should be considering whether he has got the powers at this time to intervene and if he hasn’t got the powers, what kind of powers he needs,” she said.
If the bid goes ahead and is subject to a European Commission investigation, the U.K. could ask for it to be referred back on public interest grounds, at which point ministers could block it. Or the government could try to amend the Enterprise Act, which currently allows ministers to intervene to protect national security, media plurality and the stability of the financial system.
Bailey’s committee will discuss on May 6 whether to hold hearings with executives. “I view it with great concern,” Bailey, who is a Labour lawmaker, told reporters. “We have a company which closed its operations in Sandwich for tax purposes and now says it’s buying a British company for tax purposes.”