Warner Asks Pfizer to Back Off Its Hostile Bid; Affirms AHP Merger Plan

Pfizer Inc. said Tuesday that it may take its $75-billion all-stock bid for Warner-Lambert Co. directly to shareholders as Warner-Lambert stood by its plan to merge with American Home Products Corp.

Pfizer told Reuters in a telephone interview that it expects to decide whether to launch an exchange offer or a proxy fight to remove Warner-Lambert’s board of directors in a week to 10 days, after first meeting with its own shareholders.

New York-based Pfizer last week made an unsolicited bid to take over Warner-Lambert just hours after Warner-Lambert had unveiled plans to merge with American Home Products in a $70-billion stock deal.

At stake is the No. 1 spot in the pharmaceutical industry.

Warner-Lambert’s chief executive appealed Tuesday to Pfizer’s 17 board members in an attempt to persuade the prescription drug maker to back off its hostile $74.6- billion takeover offer.

“Our board of directors is disappointed that our two companies--which have been partners in a very important venture for both of us and our patients--are now in a dispute of major significance,” Lodewijk J.R. de Vink said in a letter to the Pfizer board.

Pfizer and Warner-Lambert, based in Morris Plains, N.J., have a co-marketing agreement to sell the blockbuster drug Lipitor. But Warner-Lambert now is looking for a way out of the agreement in the face of Pfizer’s hardball tactics.

Warner-Lambert shares rose $2.19 to close at $90.06, while Pfizer closed up 25 cents at $35 and AHP closed down $1.38 at $52.88, all on the New York Stock Exchange.