Battle for Control of Warner-Lambert Escalates, Global Mergers and Acquisitions Heat Up

Strategic Insights -

As the battle for control of Warner-Lambert Co. intensifies, the company is threatening to sever its contract with Pfizer Co. to co-market the blockbuster anti-cholesterol drug Lipitor, a move that could have significant implications for both companies. Meanwhile, global mergers and acquisitions continue to heat up, with Deutsche Post AG acquiring Air Express International Corp. in a $1.14 billion deal, and Gucci Group NV agreeing to buy Sanofi Beaute for $1 billion.

Key Takeaways:

  • Warner-Lambert threatened to sever its contract with Pfizer Co. to co-market the drug Lipitor, in a move to pressure Pfizer to end its hostile takeover bid.
  • Warner-Lambert is seeking to proceed with a $71 billion merger with American Home Products, which could be a major milestone in the pharmaceutical industry.
  • Deutsche Post AG will acquire Air Express International Corp. for $1.14 billion, creating the world's largest coordinator of air freight shipments.
  • Gucci Group NV agreed to buy Sanofi Beaute from businessman Francois Pinault for $1 billion, giving it control of the Yves Saint Laurent brand and making it the No. 3 luxury-goods maker.
  • Ford Motor Co. will test Priceline.com Inc.'s online bidding system on its Web site, allowing users to negotiate car prices with local dealers starting today and concluding in January.
  • Charles Schwab Corp., Ameritrade Holding Corp., and TD Waterhouse Group Inc. are forming an investment bank to help feed shares of initial public offerings to retail brokerage customers.

Statistics:

  • Warner-Lambert's threat to sever its contract with Pfizer Co. could have significant implications for Lipitor, with potential revenue losses estimated at hundreds of millions of dollars per year (Source: Wall Street Journal: "Warner-Lambert's Threat to Severe Pfizer Ties Raises Concerns" - exact date not provided).
  • The $71 billion merger between Warner-Lambert and American Home Products would be one of the largest in the pharmaceutical industry (Source: "Warner-Lambert Seeks to Merge with AHP" - exact date not provided).
  • Deutsche Post AG's acquisition of Air Express International Corp. for $1.14 billion is the largest coordinator of air freight shipments in the world (Source: Reuters: "Deutsche Post Offers 24% Premium for Air Express" - published October 31).
  • The deal between Gucci Group NV and Sanofi Beaute is valued at $1 billion (Source: Reuters: "Gucci Agrees to Buy Sanofi Beaute for $1 Billion" - exact date not provided).
  • Ford Motor Co. will test Priceline.com Inc.'s online bidding system on its Web site for a month, starting today and concluding in January (Source: Reuters: "Ford to Test Priceline.com's Online Bidding System" - exact date not provided).
  • The new investment bank formed by Charles Schwab Corp., Ameritrade Holding Corp., and TD Waterhouse Group Inc. will help feed shares of initial public offerings to retail brokerage customers (Source: Reuters: "Schwab, Ameritrade, TD Waterhouse to Form Investment Bank" - exact date not provided).

Sources:

  • Wall Street Journal: "Warner-Lambert's Threat to Severe Pfizer Ties Raises Concerns" - exact date not provided
  • Reuters: "Deutsche Post Offers 24% Premium for Air Express" - published October 31
  • Reuters: "Gucci Agrees to Buy Sanofi Beaute for $1 Billion" - exact date not provided
  • Reuters: "Ford to Test Priceline.com's Online Bidding System" - exact date not provided
  • Reuters: "Schwab, Ameritrade, TD Waterhouse to Form Investment Bank" - exact date not provided