Monday headlines include Pfizer considering a bid for AstraZeneca, Amazon's profitable tax-free subsidiary making fewer profits, Comcast talking to Charter about divesting some customers, Tesla's plan to build cars in China and General Mills altering the terms of its online user agreement.
Pharmaceutical giant Pfizer (PFE) has reportedly proposed a $101 billion takeover of rival AstraZeneca (AZN). Britian's Sunday Times said that no talks were currently underway. AstraZeneca has a number of promising cancer drugs in its pipeline, which makes it an attractive takeover target despite patents that will expire soon on a number of its current best sellers. Pfizer is itself struggling with the loss of patents on some of its best sellers, including Lipitor.
A profitable European subsidiary of Amazon (AMZN) that exists entirely because of the company's strategy to minimize the amount of taxes it pays has been less profitable in the last two years due to tighter rules in the U.S. Amazon's U.S. operations lease the right to re-license technologies owned by the parent company to a tax-exempt partnership based in Luxemburg. The Luxemburg unit then re-leases the technologies to other Amazon units at a much higher rate. Amazon has been criticized in both the U.S. and Europe for its tax-avoidance strategies. The profits reported by the Luxemburg unit has been cut in half sins 2012, when court filings revealed a dispute between Amazon and tax authorities in the U.S.
Cable giant Comcast (CMCSA) has held discussions with Charter Communications (CHTR) about its plan to separate about 3 million subscribers as past of its proposed acquisition of Time Warner Cable (TWC). The subscribers to be divested are worth $18 billion to $20 billion according to media reports. Options on the table include either the sale of those customers to Charter, or spinning off a new entity that Charter would buy a substantial minority stake in.
Elon Musk, the founder and CEO of electric car maker Tesla (TSLA) plans for the company to start building cars in China in the next three or four years. Tesla also plans to build a substantial network of charging stations in the country. China is the world's largest automobile manufacturer and Musk said the country is “very important to the future of Tesla.” Building cars in-country would allo Tesla to avoud a 25% import tariff.
Packaged-food giant General Mills (GIS) is changing some of its online policies again after a recent update sparked a backlash on social media. The company recently adopted a policy saying that consumers who interact with the company online, including visiting its website or engaging through social media. The terms reportedly say that disputes will be resolved through informal negotiation or arbitration. The company has also said that the original terms did not mean that people who like the company, or one of its brands on Facebook (FB) would be subject to the arbitration agreement.