Allergan will acquire Pfizer, told you Forest is taking over this company

Discussion in 'Pfizer' started by anonymous, Nov 19, 2015 at 6:12 PM.

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  1. anonymous

    anonymous Guest

    Allergan-Pfizer Talks Include Allergan as Possible Buyer
    [​IMG]ENLARGE
    No matter how any deal is technically structured, the much larger Pfizer is expected to be effectively buying Allergan. Photo: carlo allegri/Reuters

    By
    Jonathan D. Rockoff,
    Dana Cimilluca and
    Dana Mattioli
    Updated Nov. 19, 2015 5:48 p.m. ET
    Allergan PLC and Pfizer Inc. are considering structuring a merger of the drug companies so that it is an acquisition of Pfizer by Allergan, according to people familiar with the matter.

    However the deal is technically structured, the much larger Pfizer will effectively be buying the Dublin-based Allergan and assuming a lower offshore tax jurisdiction. Allergan shareholders would receive a premium and end up with 40% to 45% of the combined company, some of the people said. The deal is expected to be mainly in stock, but it could contain a small cash component, they said.

    While the timing could get sped up, the two sides are likely to strike a deal in seven to 10 days—assuming the talks don’t fall apart, the people said.

    It is unclear why Allergan would be the acquiring entity, but the move could make it easier for the companies to sidestep a government crackdown on so-called inversion deals, in which a U.S. company buys a smaller foreign rival and moves its tax headquarters abroad.

    On Thursday, the Treasury Department released new rules aimed at discouraging such deals and keeping U.S. companies from putting their addresses in foreign countries to reduce their tax bills.

    As for the terms of any tie-up, Pfizer is expected to swap just over 11 shares for each Allergan share. While that means the deal’s price will move around, as of Thursday’s close, such a ratio would value the stock portion at $355 an Allergan share.

    Shares of the New York-based Pfizer fell 3.1% to $32.29, hurt by fears of the impending Treasury crackdown. Allergan stock fell 2.8% to $302.05. Before The Wall Street Journal first reported on the merger talks late last month, Allergan stock traded at $287.04.

    Allergan’s market value currently stands at $122 billion, while Pfizer’s is $206 billion.

    A deal would bring anti-wrinkle treatment Botox, dry-eye treatment Restasis and other popular Allergan drugs to Pfizer’s arsenal of patent-protected medicines. Pfizer has been trying to bolster its branded-drug portfolio, after recently completing a roughly $16 billion deal for Hospira Inc., which is developing lower-priced knockoffs of costly biotech drugs.

    A deal at $355 a share would value Allergan at about $140 billion, making it by far the largest deal in what’s shaping up to be the busiest year ever for mergers and acquisitions. It would easily top beer giant Anheuser-Busch InBev NV’s $108 billion agreement to buy SABMiller PLC, officially struck last week.

    Inversion deals were popular in recent years, with companies rushing to sign up acquisitions of foreign targets before the government cracked down on the deals. In September 2014, the Treasury tightened inversion rules after high-profile U.S. companies such as pharmaceutical giant AbbVie Inc. struck deals that would take them overseas. AbbVie later backed away from its deal amid the pressure.

    The changes issued Thursday by the Treasury Department would make it harder for U.S. companies to buy a company in one foreign country and locate the combined entity’s address in a different country.

    The new rules could have immediate implications for Pfizer’s attempt to merge with Allergan. In addition, the rules would reach back to all inversions completed since Sept. 22, 2014, potentially causing problems from companies such as Medtronic PLC and Mylan NV that have already completed their inversions.

    On Wednesday, Treasury Secretary Jack Lew had issued a letter outlining intentions to announce more anti-inversion rules this week.

    “Unless and until Congress acts,” Mr. Lew wrote, “creative accountants and lawyers will continue to find new ways for companies to move their tax residences overseas and avoid paying taxes here at home.”

    Rep. Sander Levin (D., Mich), the top Democrat on the House Ways and Means Committee, said he was “encouraged” by Treasury’s coming action.

    “The fact that American companies, including Pfizer, continue to pursue inversions makes clear that additional steps are needed to stop this trend,” he said in a statement.

    —Richard Rubin contributed to this article.

    Write to Jonathan D. Rockoff at Jonathan.Rockoff@wsj.com, Dana Cimilluca at dana.cimilluca@wsj.com and Dana Mattioli at dana.mattioli@wsj.com
     

  2. anonymous

    anonymous Guest

    Makes sense, why bother with US authorities, if Allergan is the acquiring company doesn't that take the Feds out of the equation?
     
  3. anonymous

    anonymous Guest

    Just wondering what may happen to my stock???
     
  4. anonymous

    anonymous Guest

    Oh, I see it; 3 or 4 for one split???
     
  5. anonymous

    anonymous Guest

    It's kinda like agent Smith in the Matrix - it doesn't matter who's bigger, smaller, the acquirer or anything else - the PFE virus of killing innovation, killing risk taking, favoring activity over performance, etc will spread faster than the speed of light and infect all in its path. When the smoke clears, this company will remain Pfizer and that's not a good thing.
     
  6. anonymous

    anonymous Guest

    Look for Brent Saunders to be President and CEO of the established products company to be spun off from Pfizer by 2018.

    To feed the Pfizer beast for sustained growth, the innovative products business will have GSK in its cross hairs after the spin-off as well as picking up smaller bolt ons as potential blockbusters hit phase III and near coming to market.
     
  7. anonymous

    anonymous Guest

    Business is great ! Wonder how many will b squeezed out; this will be a great deal.