Pfizer lets it slip: takeover could cost thousands of jobs

PFIZER last night signalled that its £63billion takeover of British rival AstraZeneca may cost thousands of jobs. The US drugs firm told MPs its planned takeover would ‘reduce overlaps’ between the firms and create ‘significant financial synergies’.

The language is business shorthand for cost savings – such as laying off workers.

The warning came in evidence handed to MPs ahead of chief executive Ian Read appearing before the business committee of the Commons today.

Pfizer insists its pledges of a long-term commitment to Britain are ‘tangible, legally binding and represent significant investment in the economy, skilled workforce and knowledge base of the UK’.

Downing Street declined to say whether Government lawyers accepted that the pledges were legally watertight.

‘We are taking a very robust approach on this because in the event of there being an agreement between shareholders we want the very best possible deal for the UK, and we will be exploring every way of getting that,’ said a No 10 spokesman.

Ministers are under pressure to order an inquiry into the deal, following warnings that it could have a major impact on British science and jobs.

Authorities in the United States and in Sweden, where AstraZeneca has 5,900 staff, are also concerned about the potential impact on jobs.

Business Secretary Vince Cable will be pressed by MPs today over whether he plans to call in the deal for scrutiny.

Astra boss Pascal Soirot will also face questioning about the likely impact on his firm of any takeover.

Labour said Pfizer’s promises were ‘not worth the paper they’re written on’.

And Sweden’s finance minister Anders Borg has warned Mr Cameron the pledges should be taken with a ‘sackful of salt’ as Pfizer reneged on similar promises on jobs and investment after its takeover of Pharmacia.

A poll last night found that just 14 per cent of the public believe the takeover is in Britain’s interests. Only 19 per cent of people think ministers are doing enough to protect jobs and skills.

The Survation poll for the Unite union found that 74 per cent believe a deal on this scale should be subject to a ‘public interest test’ by Government – a move that would require a change i n the law.

In its evidence to the Commons business committee l ast night Pfizer repeated its pledge to continue investment in the UK for at least five years.

The firm will face questions today over how it will reconcile its pledges to Britain with its nod to shareholders that the deal will result in mas- sive job cuts and savings. David Rutley, Tory MP for Macclesfield, where Astra employs 2,000 staff, last night urged Pfizer to offer further assurances.

Mr Rutley said: ‘Our science base is a vital national asset. This is an uncertain time for employees and I want Pfizer to put their cards on the table and provide stronger, more enduring commitments.’

City sources are expecting Pfizer to return with a higher bid this week of potentially £60 a share.

An offer, worth £10 a share less, has been rejected by the Astra board of directors. Mr Read could lose out on a £70million shares windfall if the controversial takeover collapses.

As Britain’s second biggest drugs company, Astra employs 6,700 staff in the UK and accounts for 2.3 per cent of this country’s exports.