How AstraZeneca escaped Pfizer's clutches this time
By Ben Hirschler
LONDON (Reuters) - On a sunny day in San Francisco last January, AstraZeneca (AZN.L: Quote) Chief Executive Pascal Soriot was on his way to the Westin St. Francis hotel on Union Square to give investors some unexpectedly good news.
After long refusing to put a date on when the British drugmaker's sales figures would pull out of a nosedive, Soriot surprised the market on January 14 with a bold prediction that sales by 2017 would be back at 2013 levels.
What shareholders did not know at the time was that two days earlier AstraZeneca had written to U.S. rival Pfizer (PFE.N: Quote) rejecting its offer to buy the London-based group for close to $100 billion.
Shares rose on the 2017 sales forecast as investors looked forward to a time when AstraZeneca would finally put behind it a wave of patent expiries on its drugs. It was a defiant performance by Soriot - CEO for little over a year - whose long-term forecast suggested much of Wall Street had got his firm's valuation all wrong.
"Essentially we believe that we can return to growth faster than most people have been forecasting so far," he told the annual JP Morgan Healthcare Conference. "Our next step would be that, by 2020, we want to launch at least 10 new medicines."
The previous week in New York, Frenchman Soriot and Swedish Chairman Leif Johansson had met with Scottish-born Pfizer boss Ian Read and his New Jersey finance head Frank D'Amelio to discuss details of a possible deal in the neutral ground of the Pierre hotel overlooking a snowy Central Park.
Those talks in turn had been prefaced by an email and phone call from Read to Johansson proposing a merger on November 25.
So both sides had plenty of time to develop a war-game for what was always going to be a politically charged takeover fight, involving the biggest attempted foreign takeover of a British firm and the creation of the world's largest pharmaceuticals group - with a conveniently reduced tax bill. Continued...