Yahoo Finance Miliband Urges Caution On Pfizer Takeover Bid
Ed Miliband has written to the Prime Minister to demand a full assessment of whether drugs company Pfizer (NYSE: PFE - news) 's bid for UK-based AstraZeneca (NYSE: AZN - news) would be good for Britain.
The Labour leader argues a tougher "public interest test" should be introduced on big business takeovers of this type.
Pfizer's latest offer for AstraZeneca, worth £63bn, was rejected by the British company, which said on Friday the proposal had "substantially undervalued" it.
The US pharmaceutical giant is reported to be considering its next move.
David Cameron said the Government had received "robust" assurances from Pfizer about protection for British jobs and research under the proposed deal, and stressed it was a decision for shareholders.
In his letter to Mr Cameron the Labour leader wrote: "I am strongly of the view that, when it comes to such a strategically important part of UK PLC, we need a more substantive assessment of whether this takeover is in the national economic interest before the UK government allows itself to be seen to be supporting it."
Former Labour trade minister Lord Davies expressed concerns to Sky News that Pfizer’s commitment to locate at least 20% of its research and development (R&D) workforce in the UK may be little more than a "chocolate promise".
This was a reference to the hostile takeover of the UK confectioner Cadbury by the US food giant Kraft Foods (NasdaqGS: KRFT - news) in 2010, when Labour was in office.
Kraft closed Cadbury's Cheltenham headquarters and went back on a promise to save the Somerdale factory near Bristol, leading to job losses.
Speaking about the Pfizer deal, Conservative Party chairman Grant Shapps told Sky's Murnaghan programme: "What is most important is Britain gets to benefit from whatever the deal is - if that can mean more R&D here, more jobs in this country and a great Anglo-American tie-up, that's good."
But shadow business secretary Chuka Umunna told Sky News: "My worry is this is primarily being driven by tax and essentially, Pfizer is looking to use one of the jewels in the crown of British industry as a pawn in some kind of tax planning game.
"We wouldn't, which the Prime Minister and Chancellor have been doing in the last week, ... [be] acting as a cheerleader for this big American company seeking to take over a fantastic, innovative R&D company."
A Downing Street source said: "The Government isn't cheerleading for Pfizer, it is fighting for British jobs and British science.
"By suggesting otherwise, Ed Miliband is putting politics before the national interest and undermining that position. We engaged early with both companies precisely to avoid previous governments' failures in these types of situation."
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