THE US PHARMACEUTICAL seeking to acquire UK rival AstraZeneca represents a tax avoidance risk, according to the UK druggist's chief executive Pascal Soriot.
Pfizer, which has proposed a £63bn takeover of the UK business, intends to use the AstraZeneca deal to relocate its tax base to the UK in a move designed to see it unfettered by the US 35% corporation tax rate and take advantage of Britain's kinder 20% levy.
Soriot told The Guardian: "The risk is that if it turns into a controversy our own company would be impacted by it. Even if we were to agree a [takeover] deal, it takes eight to ten months to close it.
"If this controversy leads to a delay, you have to remember the shareholders of Pfizer can still vote no. Imagine we go through this entire process of waiting, a lot of anxiety in our employees' minds, lots of distraction, potential controversy surrounding us and in the end the deal doesn't happen and we are left flailing in the wind."
Soriot also hit back at Pfizer's pledge to ringfence work on important medicines and criticised the US group's plan to split the combined business into three separate divisions.
"It's all very well to say we will ringfence, but what does it mean, ‘ringfencing'? You have to understand precisely how you would do that. The model where you would split the company in three pieces I don't think would work at all for our business."
You may also like
If budgeting is to have any value at all, it needs a radical overhaul. In today's dynamic marketplace, budgeting can no longer serve as a company's only management system; it must integrate with and support dedicated strategy management systems, process improvement systems, and the like. In this paper, Professor Peter Horvath and Dr Ralf Sauter present what's wrong with the current approach to budgeting and how to fix it.
In this white paper CCH provide checklists to help accountants and finance professionals both in practice and in business examine these issues and make plans. Also includes a case study of a large commercial organisation working through the first year of mandatory iXBRL filing.