Astra–Zeneca Merger

  • B. Rajesh Kumar
Part of the Management for Professionals book series (MANAGPROF)


In 1999, Zeneca and Astra merged to form a new company called AstraZeneca. The merger deal was valued at $67 billion. It was billed as one of the largest ever European mergers at the time of the deal. The deal made UK-based Zeneca and Sweden-based Astra the fourth largest drug company in the world with $14 billion in sales. Under the terms of the deal, Zeneca shareholders received 53.5% of the new company, while Astra shareholders received 46.5% of the new company. The merger was intended to build the scale to match the global leaders like GlaxoWellcome and Merck. Zeneca made the leading hypertension drug Zestril. Astra possessed the world’s best-selling prescription drug for ulcer – Prilosec. The two companies were market leaders in anticancer drugs and anesthetics. Astra and Zeneca had highly complementary product portfolios as well as sales and marketing organizations. At the time of the deal, AstraZeneca deal was the largest drug merger in Europe which surpassed the $28 billion combination of Ciba–Geigy and Sandoz to form Novartis in the year 1996. The merger improved operating efficiencies by eliminating duplicate infrastructure through better asset utilization and effective exploitation of economies of scale. The new AstraZeneca focused on five therapeutic areas of gastrointestinal, cardiovascular, respiratory, oncology, and anesthesia. The return analysis for AstraZeneca was done for 1 year which included the period of merger announcement to post-merger period (January 12, 1998–January 12, 1999). The cumulative return for the entire period of analysis was 10.20%.


  1. AstraZeneca Media Release (2013) AstraZeneca to acquire Pearl Therapeutics to strengthen respiratory portfolio. Accessed 12 July 2018
  2. BBC News (1998) Business. The company file: Zeneca and Astra merge to form drug giant. File. Accessed 12 July 2018
  3. Blake H (2012) A history of AstraZeneca. Accessed 12 July 2018
  4. CNNMONEY News International (1998) Another drug giant created. Accessed 12 July 2018
  5. Cowell A (1998) Zeneca buying Astra as Europe consolidates. Accessed 12 July 2018
  6. Emmett A (2000) The Urge to merge. Accessed 12 July 2018
  7. Lipin S, Stephen D (1998) Zeneca Group, Astra unveil merger valued at $35 billion. Accessed 12 July 2018
  8. Pharmaceutical Online News (1998) Astra, Zeneca to merge. Accessed 12 July 2018
  9. (1999) Zeneca, Astra announce plans to merge. Accessed 12 July 2018
  10. PharmaTimes (2006) AstraZeneca to buy Cambridge Antibody Tech. Accessed 12 July 2018
  11. Pollock A (2007) AstraZeneca buys MedImmune for $15.6 billion. Accessed 12 July 2018
  12. Seely R (1998) Drug Makers Zeneca Astra to merge. Accessed 12 July 2018

Copyright information

© Springer Nature Switzerland AG 2019

Authors and Affiliations

  • B. Rajesh Kumar
    • 1
  1. 1.Institute of Management TechnologyDubaiUnited Arab Emirates

Personalised recommendations