Skip the mega merger in the pharmaceutical industry between the American Pfizer and the Irish Allergan, after the move by the US Treasury against tax inversion. The two companies announced it in a press release, confirming the rumors that have been circulating in the last few hours.
Pfizer and Allergan have declared their $160 billion merger for bankruptcy by mutual agreement. “The decision was guided by the actions announced by the US Treasury Department on April 4,” explains Pfizer, which would have seen tax benefits with domiciliation in Ireland.
The US Treasury Department has announced its intention to make the rules more stringent (retroactively) in order to combat the so-called tax inversion, i.e. the widespread practice among American companies of mergers aimed essentially at moving the sole legal headquarters to countries with favorable tax treatment.
In this decision, Pfizer will pay Allergan $150 million in reimbursement of expenses associated with the transaction. "Although we are disappointed that the merger with Pfizer will not proceed, Allergan aims to achieve strong and sustainable growth on the basis of its assets", reads the note released by the Dublin company.
Pfizer will publish its first quarter accounts on May 3, while Allergan will release them on May 10, along with a plan update.
Posted by Valeria Panigada on Wed, 06/04/2016 – online finance
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