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Pfizer pursuit of Astra 'tax-driven', says Swedish finance minister

Published 13/05/2014, 16:29

COPENHAGEN (Reuters) - Sweden's finance minister labelled U.S. drugmaker Pfizer's proposed $106 billion (62.9 billion pounds) offer for drugs firm AstraZeneca as "tax-driven" on Tuesday and warned that jobs would be lost if it went through.

AstraZeneca, which was created through a 1999 merger between Britain's Zeneca and Sweden's Astra, has around 5,900 employees in Sweden out of about 51,500 globally, according to its website.

"Now, we know that mergers are complicated and that there is a big risk that a tax-driven merger will only be beneficial if you really are tough on cost-cutting and that's not very beneficial for society," Finance Minister Anders Borg told reporters in the Danish capital Copenhagen.

"The basic logic of this merger is tax-driven."

Swedish Prime Minister Fredrik Reinfeldt said last week that he was worried Swedish jobs at AstraZeneca could be lost if Pfizer succeeds in buying it, news agency TT reported.

Pfizer hinted it could raise its proposed $106 billion offer if AstraZeneca would only engage in talks, as its boss was grilled by UK lawmakers on his commitment to British research spending and jobs on Tuesday.

In response, AstraZeneca's chief executive accused Pfizer of an "opportunistic" proposal and a ploy to cut taxes that risked its reputation.

Pfizer says the proposed deal would involve job losses and result in it paying less tax but argues such things are necessary to improve efficiency in an industry where governments are pressuring drug companies to cut costs.

Borg's comments were the second time he has expressed criticism of the deal, and he repeated a warning that promises to protect jobs should be taken with a pinch of salt.

"Pfizer have been adding some 120,000 staff members through mergers over the last 15 years and have cut a hundred thousand jobs ... on the global market," he said. "So they have a track record of cutting back jobs."

    

(Reporting by Teis Jensen; Editing by Pravin Char)

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