AZ's management, in fending off the unsolicited Pfizer takeover bid, put out a very optimistic forecast of its future fortunes based on its management read of its own pipeline. In doing so, they essentially stated their shares were worth at least 58.50 pounds and therefore Pfizer's offer of 55 was deemed inadequate. They subsequnetly basked in the sunlight of Pfizer walking away from the deal and have continued to throw around glittering forecasts for their future to all who will listen.
Now, the faction of investors, who wanted AZ to engage in talks with Pfizer to arrive at a lucrative selling price, are fighting back. They are promoting a plan whereby AZ execs will have their compensation tied to hitting the sales targets they've touted and the projected stock price they used to justify the Pfizer turndown. AZ' CEO Soriot has already said he won't do this as the stock price is subject to market forces beyond what AZ's management can influence. But the big investors, who are angry, aren't having it. They say if you use the figure to fend off the merger then you should be held to hitting that price as a condition of getting full bonuses. Sauce for the Goose. No bait and switch. See Fierce Biotech.
Posted by Bruce Lehr June 11th 2014.