AstraZeneca’s shares rose by more than 14% on Monday, after pharmaceutical giant Pfizer confirmed its interest in a takeover bid.
Pfizer said it had contacted AstraZeneca over a multi-billion dollar bid for the UK-based drug maker.
If successful, the deal would be the biggest ever takeover of a UK firm by a foreign company.
Pfizer said it approached AstraZeneca on Saturday, after an initial offer in January, worth $95 billion, was rebuffed.
AstraZeneca said the original offer “significantly undervalued” the firm, which employs more than 51,000 staff.
However, AstraZeneca said it was “confident” its strategy would create “significant value” for shareholders on its own.
“The Board remains confident in the ongoing execution of AstraZeneca’s strategy as an independent company,” it added.
Pfizer said in a statement that AstraZeneca’s refusal to engage meant it was currently “considering its options”.
AstraZeneca manufactures drugs in 16 countries focusing on treatments for diabetes, cancer and asthma as well as antibiotics.
Recently the company posted a drop in first quarter profits – and laid off thousands of staff in an effort to reduce its costs to compensate for a fall in sales – due to patent losses on blockbuster medicines.
In April, AstraZeneca posted a drop in first quarter profits after its earnings were by hit by patents expiring on some of its older medicines.
Pfizer said the deal was “a highly compelling opportunity” for AstraZeneca’s shareholders.
It said if the takeover went through, the combined company would have management in both the US and the UK, but would list its shares on the New York Stock Exchange.
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