The historic corporate BLOCKBUSTER DEAL highlights the need for the United States to reform its archaic tax laws, its a WAKE-UP call to Washington DC politicians of what’s to come if CHANGE does not occur soon.
Ireland’s corporate tax rate, adjusted would be just 17% versus the United States about 39%. Under the merger, Pfizer saves BILLIONS of dollars annually. But the deal moves Pfizer to a foreign country. Job cuts are likely in the consolidation efforts with reduced labor costs expected, as a result.
Under terms of the deal, the companies will exchange 11.3 Pfizer shares for every Allergan share, and the deal also contains a cash component between $6 billion and $12 billion. The companies said the deal represents a roughly 30% premium to Allergan’s closing price Oct. 28, the day The Wall Street Journal reported the companies were in talks. After the deal, former Pfizer shareholders will own about 56% of the combined company.
Pfizer and Allergan said the enterprise value of the deal, which often includes debt, is $160 BILLION. It is expected to close in Q2 2016.
To help secure a lower tax rate, the businesses of Pfizer and Allergan will be combined under Allergan, which will be renamed Pfizer PLC and trade under the ticker symbol PFE, Pfizer’s current symbol, on the New York Stock Exchange.