12/05/2014 World Business Report

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

BBC World News. Now for the latest financial news in

World Business Report. Fighting for independence, as

AstraZeneca says it wants to go it alone, so Pfizer offers job

guarantees to the British PM. Stable after surgery, Lee Kun Hee,

the man credited with making Samsung the biggest smartphone maker in the

world is said to have survived an emergency heart operation.

Welcome to World Business Report. I'm Alice Baxter. In a moment we

will head live to Singapore and hear more on who will be at the helm of

Samsung while Lee recovers. First, a critical week in Pfizer's bid for

AstraZeneca. As the bid becomes increasingly political, so bosses

from both companies are to be grilled by Britain's MPs this week.

Over the weekend PM, David Cameron said that the US company has given a

five`year commitment to complete AstraZeneca's new research centre in

Cambridge and will retain a factory in the northwest English town of

Macclesfield. While speaking on the BBC's Andrew Marr Show, the British

leader made it clear that talking about the deal was better than

simply blocking it. I think the right thing to do is to

engage and get stuck in with these companies as I have done. We need to

make sure we get good guarantees and the best deal for Britain. I will

stand up always for British jobs, science and so on. It is important

to make the point that Britain benefits by being an economy that is

open to overseas investors. Think of Jaguar Land Rover. They have created

9000 jobs. Think of companies like AstraZeneca that have benefited by

being able to go into other countries and invest and take over

and run businesses. So with British politicians wading

into this corporate deal, exactly how British is AstraZeneca? Well,

there's a French chief executive, and a Swedish chairman and currently

reportedly 87% of its staff are overseas. Astrazeneca was formed 15

years ago from an Anglo`Swedish merger, so even the company's roots

are only half British. Yet the $106 billion takeover bid has forced

politicians at Westminster to line up in defence of British jobs and

science. So what about on the research and development side of the

company? The company does have close ties with top universities in the

UK, but it's British labs are responsible for a dwindling portion

of its medicines. Of the top ten medicines sold by AstraZeneca, only

three, all for cancer, were invented in its British labs. And future drug

sales will rely even less on its British lab work. Only one of the 13

experimental medicines in the company's pipeline is being

developed in the UK. So with this in mind, you could say that getting any

guarantees for UK jobs is impressive and it's time for shareholders to

decide the company's fate, not the politicians? Let's discuss. I am now

joined by Basil Petrides, an analyst at Beaufort Securities. Ultimately

this will be shareholder decision. It is important to dissect this.

Politicians have moved into this debate. There is debate in the US

about this. Ultimately, shareholders take responsibility. They risk their

capital. It is their decision that needs to be made. The shareholders

have clearly told the chairman and CEO of AstraZeneca that if an

improved offer comes in, and I expect one towards the end of

week, they need to be engaged. Expectation is that Pfizer will up

the offer and raise the bid to more than ?53 per share. We have heard

from the chief executive of AstraZeneca that he would prefer to

go alone, but if there is a more competitive offer, will he be

willing to talk? I imagine he would. Probably, the price will be

?55 and certainly Pfizer have the cash. It is possible that Pfizer

will come in with an improved cash offer. Current thinking is that the

cash offer is 30% of the deal. It could be 40% as a sweetener. If

shareholders are given the opportunity to have an offer that is

acceptable, I certainly think they will take it up. We were talking

about how politicised this merger has become a hearing from the PM on

the weekend, talk of safeguarding British jobs. In the past,

AstraZeneca hasn't been shy of getting rid of jobs. It is the

nature of these beasts. These companies operate internationally.

100 to 150 countries across the world. They need to safeguard their

revenues. They need to take strategic action. They have reduced

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

you think this merger should go ahead? It certainly should go ahead.

`` you think. Reports are coming through that the

Chairman of Samsung Electronics, Lee Kun`Hee, is in a stable condition

following emergency heart surgery on Sunday. Lee, South Korea's richest

man, took over as chairman of the country's biggest company in 1987

and is credited with turning the company into an international force

in the technology market. It is now the world's largest smartphone

maker. He stood down as chairman in 2008 for two years after he was

convicted of tax evasion, but then given a presidential pardon. Joining

me now is Rico Hizon, live from our Asia business hub in Singapore. So

Lee's son, Jay Lee, is currently vice`chairman.is he now expected to

step into his father's shoes and take over? That is what many

analysts are saying. The 45`year`old son is the international face Samsun

electronics. He is believed to have brokered deals with companies like

Apple. With its high`profile `` his high`profile, it is thought he will

exceed `` succeed his father. Analysts think that he will help the

younger Mr Lee gave control of the leadership. There was a plan any

short public offering of STS which provides information technology for

Samsun electronics and he is the third largest shareholder. He holds

a key stake in the company, the de facto holding company of the Samsung

group. It is widely believed he will be the one who will take over the

company. What do investors make of his son? Do they think he is capable

of holding onto the leading position in this incredibly competitive

market? They think he will be able to hang on and be chairman. He does

have competition. Lee Kun Hee has three children, including two other

daughters who are in executive positions. Analysts said that Jay

Lee has the upper hand because of his experience, having been the

chief operating officer and president of the company and having

been with the company since 1991. Investors credit him with

contributing to the explosive growth of the firm in the smartphone

sector. He has built strong relationships with global business

leaders and was instrumental in forging partnerships with customers.

So, it looks like he is the frontrunner to succeed his father.

Place your bets now. Many thanks. UK satellite operator Inmarsat is to

offer a free, basic tracking service to all the world's passenger

airliners. The offer follows the case of Malaysia Airlines flight

MH370, which disappeared without trace on eight March. Inmarsat says

the free service it is offering would carry definitive positional

information. Neighbors, a Universal Pictures comedy with Seth Rogen and

Zac Efron, became the highest grossing film over its opening

weekend in the US and Canada. The movie knocked last week's leader,

The Amazing Spiderman two from the top spot. Neighbors took in sales of

$51 million while Spiderman raked in only $37 million in its second week.

BP plans to invest $1.5 billion this year to increase its production of

natural gas in Egypt according to a MENA agency report. Egypt currently

imports liquefied natural gas for power generation as two years of

political turmoil takes its toll on domestic gas production

capabilities. From me and the team, that's all for this hour.

The Commonwealth Games baton has returned to return after a worldwide

tour of 63 nations and territories. It was launched from Buckingham

Palace