UK drugmaker AstraZeneca has rejected US rival Pfizer's final takeover offer, saying the improved bid still undervalues the company.
The final bid valuing AstraZeneca at about £69bn ($116bn, €85bn) or £55.00 per share "undervalues the Company and its attractive prospects," AstraZeneca said in a statement.
"Even assuming that other key aspects of any proposal had been satisfactory, that the price at which the Board of AstraZeneca would be prepared to provide a recommendation would have to be more than 10% above the level contained in Pfizer's Friday Proposal," Leif Johansson, chairman of AstraZeneca, said.
"The Final Proposal is a minor improvement which continues to fall short of the Board's view of value and has been rejected."
Johansson said Pfizer's approach throughout its pursuit of AstraZeneca has been driven by its own benefits including cost savings and tax minimisation. He added that Pfizer has failed to make a "compelling strategic, business or value case" from the parties' first meeting to their latest discussion on 18 May.
The company noted that its business will continue to create significant value for all stakeholders as an independent company, but Pfizer's proposal would dilute the real value of the company.
"We have rejected Pfizer's Final Proposal because it is inadequate and would present significant risks for shareholders, while also having serious consequences for the Company, our employees and the life-sciences sector in the UK, Sweden and the US," Johansson added.
Pfizer earlier increased its offer for AstraZeneca to £55 per share from £53.50 per share, adding that it cannot raise the offer further. This is the fourth proposal Pfizer has made.
The US company added that it will not make a hostile offer directly to AstraZeneca shareholders and will only announce a firm intention to make an offer with the recommendation of the board of directors of AstraZeneca.
"We remain ready to engage in a meaningful dialogue but time for constructive engagement is running out. We have said from the beginning that we will remain disciplined in the price we are willing to pay and we will not depart from that guiding principle," Pfizer CEO Ian Read said.
"We believe that our proposal represents compelling and full value for AstraZeneca and that other issues that have been raised by AstraZeneca do not represent material difficulties."