Warner-Lambert Agrees to Talk to Pfizer

Warner-Lambert Co. bowed to investor pressure and agreed to talk to unfriendly suitor Pfizer Inc. about its $75-billion takeover proposal, putting its agreed $54-billion merger with American Home Products Corp. in jeopardy. Pfizer said it was pleased with the decision and hoped for an “expeditious completion” of a transaction. But AHP said it stands by its merger pact with Warner-Lambert and said the terms of the deal “remain in full force and effect.” The California Public Employees’ Retirement System, which owns 3.7 million Warner-Lambert shares, and New York City, which owns 3.5 million, had urged Warner-Lambert to give full consideration to Pfizer’s bid. New York-based Pfizer unveiled its conditional all-stock offer for Morris Plains, N.J.-based Warner-Lambert in November, just hours after Warner-Lambert and AHP reached a merger agreement. On the New York Stock Exchange, Warner-Lambert jumped $5.06 to close at $91.88, Pfizer rose $1.88 to close at $37 and Madison, N.J.-based AHP closed up 44 cents at $42.63.