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AstraZeneca a takeover target again? CEO not commenting

Reuters - UK Focus

LONDON, July 28 (Reuters) - AstraZeneca (NYSE: AZN - news) declined to comment on Thursday on whether the drugmaker could become a takeover target once more, two years after it saw off a bid from Pfizer (NYSE: PFE - news) .

This time speculation has moved to the idea of a possible offer from Swiss-based Novartis (LSE: 0QLR.L - news) , which would increase its cancer drug operations significantly by acquiring its smaller British rival.

Citi analyst Andrew Baum suggested in a note this week that AstraZeneca's biotech expertise and advanced immunotherapy cancer pipeline made it an attractive target for the Basel-based group.

AstraZeneca has a market value of around $78 billion, against Novartis' $217 billion.

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Asked about the idea in a post-results media call, AstraZeneca Chief Executive Pascal Soriot said: "We never comment on speculation or rumours or theories. A number of people will have those assumptions but we do not comment on those."

Novartis has substantial financial firepower and its CEO Joe Jimenez said last week he was ready to see the group's AA (Other OTC: AATDF - news) - credit rating decline for the right M&A opportunity, though he also said he did not feel any pressure to do deals in the immunotherapy field.

One question-mark surrounding any potential move to acquire AstraZeneca is the stance of the British government, since new Prime Minister Theresa May has talked about developing a new industrial strategy, which could include defending important UK sectors such as pharmaceuticals.

AstraZeneca itself has made a number of bolt-on acquisitions to improve its new-drug pipeline in the past couple of years, although Soriot said this process was now effectively complete.

"We have a really full pipeline, so we would be extremely unlikely to consider a pipeline acquisition," he said. "What we are looking to potentially do is acquisitions that are earnings accretive and are strategically aligned to our focus areas." (Reporting by Ben Hirschler; editing by Susan Thomas)