Vince Cable, the Business Secretary, told MPs in an emergency Commons statement yesterday the Government would consider testing whether it was in the public interest if Pfizer pushes ahead with plans to bid £63billion for AstraZeneca.
Mr Cable added: "This would be a serious step and not one that would be taken lightly but I'm open-minded about it whilst stressing that we are operating within serious European legal constraints."
At present, the UK Government can intervene on mergers or takeovers where there is a national security issue, an issue of media plurality, competition concerns or if it could affect financial stability.
Mr Cable stressed the Coalition would approach Pfizer's contentious takeover plan from a position of "even-handed neutrality". The American giant is run by Forfar-born Ian Read.
But the Secretary of State also made clear the UK Government was "very alive to the national interest considerations here".
His remarks came as concerns over the proposed takeover grow.