Business news: AstraZeneca rejects Pfizer’s takeover bid

May 2
AstraZeneca rejects Pfizer’s takeover bid

Pharmaceutical company AstraZeneca on Friday flatly rejected drugmaker Pfizer’s sweetened takeover bid — worth $106 billion — just hours after it was leveled, describing the offer as inadequate.

After being rebuffed twice, Pfizer, the maker of Viagra, made its third attempt for the London-based rival, offering $84 a share in cash and stock, a 7.3 increase on its last bid. The deal would be the biggest-ever foreign takeover of a British business.

But AstraZeneca’s board said the terms were not right and the price substantially undervalued the company. The Anglo-Swedish firm said the potentially lucrative “pipeline” of new drugs it is developing would be disrupted by a takeover and its possible consequences.

“Pfizer’s proposal would dramatically dilute AstraZeneca shareholders’ exposure to our unique pipeline and would create risks around its delivery,” said Leif Johansson, the chairman of AstraZeneca. “As such, the board has no hesitation in rejecting the proposal.”

— Associated Press

News Corp. agrees to acquire Harlequin

News Corp. sees profit potential in the tales of princes, sexy soldiers and mysterious millionaires.

The publishing company controlled by media mogul Rupert Murdoch said Friday that it has agreed to buy romance novel publisher Harlequin Enterprises from Torstar Corp. for $415 million in cash.

Harlequin will become a division of News Corp.’s HarperCollins Publishers subsidiary and remain based in Toronto.

Founded in 1949, Harlequin publishes its steamy tales in 34 languages and sells them in more than 100 international markets. Its titles include the works of more than 1,300 authors, and it releases more than 110 titles each month.

News Corp. said the deal will extend HarperCollins’s global reach, especially in Europe and Asia Pacific. About 40 percent of Harlequin’s revenue comes from books published in languages other than English. Ninety-nine percent of HarperCollins books are published in English.

For 2013, Harlequin’s revenue totaled $372 million. About 95 percent of its revenue comes from outside Canada.

— Associated Press

Also in Business

Chevron reported a steep decline in first-quarter profit because of lower global oil prices and bad weather that slowed oil production. Chevron said it earned $4.52 billion in the first three months of the year on revenue of $50.98 billion. Last year during the same period, Chevron earned $6.18 billion on revenue of $54.3 billion. On a per share basis, Chevron earned $2.36, down from $3.18 last year. Analysts had expected Chevron to earn $2.54, on average.

Orders to U.S. factories advanced strongly in March for a second month. Orders increased 1.1 percent in March after increasing 1.5 percent in February, the Commerce Department reported. Orders for core capital goods, a category that signals business investment plans, jumped 3.5 percent in March, rebounding from a 0.9 percent drop in February. It was the biggest increase since January 2013.

CVS Caremark reported a weaker-than-expected quarterly profit on a sharp drop in sales of general merchandise, which the drugstore chain blamed on a harsh winter, milder flu season and aggressive competition. Sales of merchandise sold at the front of its stores open at least a year, such as toothpaste and snacks, fell 3.8 percent in the first quarter. CVS, which operates the No. 2 U.S. drugstore chain and a major pharmacy benefits management business, earned $1.13 billion, or 95 cents per share, in the quarter, up from $954 million, or 77 cents per share, a year earlier. Total revenue rose 6.3 percent to $32.69 billion.

The federal government offered New Yorkers smarting from Hurricane Sandy some hope that they won’t see a repeat of chronic gasoline shortages, announcing plans to create gas reserves to ease future weather-related disruptions. The two reserves — one for the New York City area and one in New England — will total 42 million gallons of gasoline and will be stored in leased commercial terminals around New York Harbor and Boston, the Energy Department said. Officials said they hope to have the new gasoline reserves in place by the end of summer, before the start of the 2014 hurricane season.

— From news services

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