12/05/2014

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:00:00. > :00:00.and 40 others are still missing. Those are the latest headlines from

:00:00. > :00:00.BBC World News. Now for the latest financial news in

:00:00. > :00:21.World Business Report. Fighting for independence, as

:00:22. > :00:26.AstraZeneca says it wants to go it alone, so Pfizer offers job

:00:27. > :00:30.guarantees to the British PM. Stable after surgery, Lee Kun Hee,

:00:31. > :00:33.the man credited with making Samsung the biggest smartphone maker in the

:00:34. > :00:45.world is said to have survived an emergency heart operation.

:00:46. > :00:51.Welcome to World Business Report. I'm Alice Baxter. In a moment we

:00:52. > :01:01.will head live to Singapore and hear more on who will be at the helm of

:01:02. > :01:06.Samsung while Lee recovers. First, a critical week in Pfizer's bid for

:01:07. > :01:08.AstraZeneca. As the bid becomes increasingly political, so bosses

:01:09. > :01:11.from both companies are to be grilled by Britain's MPs this week.

:01:12. > :01:14.Over the weekend PM, David Cameron said that the US company has given a

:01:15. > :01:17.five`year commitment to complete AstraZeneca's new research centre in

:01:18. > :01:20.Cambridge and will retain a factory in the northwest English town of

:01:21. > :01:23.Macclesfield. While speaking on the BBC's Andrew Marr Show, the British

:01:24. > :01:35.leader made it clear that talking about the deal was better than

:01:36. > :01:41.simply blocking it. I think the right thing to do is to

:01:42. > :01:46.engage and get stuck in with these companies as I have done. We need to

:01:47. > :01:49.make sure we get good guarantees and the best deal for Britain. I will

:01:50. > :01:56.stand up always for British jobs, science and so on. It is important

:01:57. > :02:00.to make the point that Britain benefits by being an economy that is

:02:01. > :02:08.open to overseas investors. Think of Jaguar Land Rover. They have created

:02:09. > :02:13.9000 jobs. Think of companies like AstraZeneca that have benefited by

:02:14. > :02:16.being able to go into other countries and invest and take over

:02:17. > :02:18.and run businesses. So with British politicians wading

:02:19. > :02:21.into this corporate deal, exactly how British is AstraZeneca? Well,

:02:22. > :02:25.there's a French chief executive, and a Swedish chairman and currently

:02:26. > :02:33.reportedly 87% of its staff are overseas. Astrazeneca was formed 15

:02:34. > :02:37.years ago from an Anglo`Swedish merger, so even the company's roots

:02:38. > :02:40.are only half British. Yet the $106 billion takeover bid has forced

:02:41. > :02:46.politicians at Westminster to line up in defence of British jobs and

:02:47. > :02:51.science. So what about on the research and development side of the

:02:52. > :02:54.company? The company does have close ties with top universities in the

:02:55. > :02:59.UK, but it's British labs are responsible for a dwindling portion

:03:00. > :03:02.of its medicines. Of the top ten medicines sold by AstraZeneca, only

:03:03. > :03:13.three, all for cancer, were invented in its British labs. And future drug

:03:14. > :03:16.sales will rely even less on its British lab work. Only one of the 13

:03:17. > :03:21.experimental medicines in the company's pipeline is being

:03:22. > :03:24.developed in the UK. So with this in mind, you could say that getting any

:03:25. > :03:27.guarantees for UK jobs is impressive and it's time for shareholders to

:03:28. > :03:32.decide the company's fate, not the politicians? Let's discuss. I am now

:03:33. > :03:42.joined by Basil Petrides, an analyst at Beaufort Securities. Ultimately

:03:43. > :03:46.this will be shareholder decision. It is important to dissect this.

:03:47. > :03:53.Politicians have moved into this debate. There is debate in the US

:03:54. > :03:58.about this. Ultimately, shareholders take responsibility. They risk their

:03:59. > :04:06.capital. It is their decision that needs to be made. The shareholders

:04:07. > :04:10.have clearly told the chairman and CEO of AstraZeneca that if an

:04:11. > :04:15.improved offer comes in, and I expect one towards the end of

:04:16. > :04:21.week, they need to be engaged. Expectation is that Pfizer will up

:04:22. > :04:28.the offer and raise the bid to more than ?53 per share. We have heard

:04:29. > :04:33.from the chief executive of AstraZeneca that he would prefer to

:04:34. > :04:37.go alone, but if there is a more competitive offer, will he be

:04:38. > :04:43.willing to talk? I imagine he would. Probably, the price will be

:04:44. > :04:46.?55 and certainly Pfizer have the cash. It is possible that Pfizer

:04:47. > :04:52.will come in with an improved cash offer. Current thinking is that the

:04:53. > :04:57.cash offer is 30% of the deal. It could be 40% as a sweetener. If

:04:58. > :05:01.shareholders are given the opportunity to have an offer that is

:05:02. > :05:06.acceptable, I certainly think they will take it up. We were talking

:05:07. > :05:09.about how politicised this merger has become a hearing from the PM on

:05:10. > :05:16.the weekend, talk of safeguarding British jobs. In the past,

:05:17. > :05:20.AstraZeneca hasn't been shy of getting rid of jobs. It is the

:05:21. > :05:27.nature of these beasts. These companies operate internationally.

:05:28. > :05:34.100 to 150 countries across the world. They need to safeguard their

:05:35. > :05:38.revenues. They need to take strategic action. They have reduced

:05:39. > :05:50.their headcount from 59,000 2/50 2000 # that is `` 52,000. White do

:05:51. > :05:57.you think this merger should go ahead? It certainly should go ahead.

:05:58. > :06:00.`` you think. Reports are coming through that the

:06:01. > :06:02.Chairman of Samsung Electronics, Lee Kun`Hee, is in a stable condition

:06:03. > :06:05.following emergency heart surgery on Sunday. Lee, South Korea's richest

:06:06. > :06:08.man, took over as chairman of the country's biggest company in 1987

:06:09. > :06:12.and is credited with turning the company into an international force

:06:13. > :06:17.in the technology market. It is now the world's largest smartphone

:06:18. > :06:20.maker. He stood down as chairman in 2008 for two years after he was

:06:21. > :06:26.convicted of tax evasion, but then given a presidential pardon. Joining

:06:27. > :06:29.me now is Rico Hizon, live from our Asia business hub in Singapore. So

:06:30. > :06:32.Lee's son, Jay Lee, is currently vice`chairman.is he now expected to

:06:33. > :06:47.step into his father's shoes and take over? That is what many

:06:48. > :06:52.analysts are saying. The 45`year`old son is the international face Samsun

:06:53. > :06:55.electronics. He is believed to have brokered deals with companies like

:06:56. > :07:01.Apple. With its high`profile `` his high`profile, it is thought he will

:07:02. > :07:06.exceed `` succeed his father. Analysts think that he will help the

:07:07. > :07:12.younger Mr Lee gave control of the leadership. There was a plan any

:07:13. > :07:16.short public offering of STS which provides information technology for

:07:17. > :07:23.Samsun electronics and he is the third largest shareholder. He holds

:07:24. > :07:29.a key stake in the company, the de facto holding company of the Samsung

:07:30. > :07:36.group. It is widely believed he will be the one who will take over the

:07:37. > :07:43.company. What do investors make of his son? Do they think he is capable

:07:44. > :07:47.of holding onto the leading position in this incredibly competitive

:07:48. > :07:53.market? They think he will be able to hang on and be chairman. He does

:07:54. > :07:57.have competition. Lee Kun Hee has three children, including two other

:07:58. > :08:05.daughters who are in executive positions. Analysts said that Jay

:08:06. > :08:07.Lee has the upper hand because of his experience, having been the

:08:08. > :08:13.chief operating officer and president of the company and having

:08:14. > :08:20.been with the company since 1991. Investors credit him with

:08:21. > :08:25.contributing to the explosive growth of the firm in the smartphone

:08:26. > :08:27.sector. He has built strong relationships with global business

:08:28. > :08:30.leaders and was instrumental in forging partnerships with customers.

:08:31. > :08:46.So, it looks like he is the frontrunner to succeed his father.

:08:47. > :08:49.Place your bets now. Many thanks. UK satellite operator Inmarsat is to

:08:50. > :08:51.offer a free, basic tracking service to all the world's passenger

:08:52. > :08:54.airliners. The offer follows the case of Malaysia Airlines flight

:08:55. > :08:57.MH370, which disappeared without trace on eight March. Inmarsat says

:08:58. > :09:13.the free service it is offering would carry definitive positional

:09:14. > :09:15.information. Neighbors, a Universal Pictures comedy with Seth Rogen and

:09:16. > :09:19.Zac Efron, became the highest grossing film over its opening

:09:20. > :09:21.weekend in the US and Canada. The movie knocked last week's leader,

:09:22. > :09:24.The Amazing Spiderman two from the top spot. Neighbors took in sales of

:09:25. > :09:29.$51 million while Spiderman raked in only $37 million in its second week.

:09:30. > :09:32.BP plans to invest $1.5 billion this year to increase its production of

:09:33. > :09:39.natural gas in Egypt according to a MENA agency report. Egypt currently

:09:40. > :09:42.imports liquefied natural gas for power generation as two years of

:09:43. > :09:53.political turmoil takes its toll on domestic gas production

:09:54. > :10:05.capabilities. From me and the team, that's all for this hour.

:10:06. > :10:13.The Commonwealth Games baton has returned to return after a worldwide

:10:14. > :10:15.tour of 63 nations and territories. It was launched from Buckingham

:10:16. > :10:16.Palace