Conservative peer Lord Heseltine has called for greater powers for the government to intervene to prevent foreign takeovers of British firms.
Lord Heseltine has spoken out in the midst of US pharmaceutical giant Pfizer’s bid to acquire the UK’s AstraZeneca which manufactures drugs in Macclesfield and employs almost 7,000 people in the UK.
While acknowledging that foreign takeovers have proved “very helpful” in the past, Lord Heseltine said that it is time government took a greater role in protecting critical national interests like the country’s science and innovation base.
If Pfizer’s bid to buy AstraZeneca goes ahead, it would be the largest takeover of a British business to date. Commentators have said the takeover is driven by Pfizer’s need for a better product pipeline and have raised doubts as to whether this would be a positive development for UK jobs and investment.
Recommending the development of “reserve powers” to halt takeovers Heseltine told the BBC: “Foreign takeovers can often be hugely helpful and I have no doctrinal preoccupations – I’ve done enough takeovers of small businesses myself to know how valuable they can be.”
However said Heseltine, without a mechanism to intervene in foreign takeovers, the UK is left on an uneven footing with other advanced economies.
Particularly concerned to preserve UK-ownership of its science and research base, Heseltine said “There are so many issues about the science base, about the supply chains, about employment prospects that ought to be explored and I don’t see any way in which this can be adequately done unless the government has reserve powers.”
Heseltine’s concerns persist despite the fact that Pfizer has offered to locate large sections of its business in the UK to protect and create more jobs in the pharmaceutical industry.
Heseltine said that the location of a company’s decision making base was the important element.
Britain’s non-interventionist approach sits in contrast to that of the French government which summoned GE boss Jeff Immelt to the Elysee Palace when his firm announced its intention to buy French engineering firm Alstom last week.
France’s economy minister, Arnaud Montebourg, said it was important “to make sure that French companies… do not become prey,” to foreign buyers.