Pfizer defies Obama with $150 billion mega-merger with Botox-maker AllerganComments Off on Pfizer defies Obama with $150 billion mega-merger with Botox-maker Allergan
US drugs giant Pfizer has incurred the wrath of President Obama as the maker of Viagra was set to announce the $150 billion (£99 billion) takeover of Botox producer Allergan to create the world’s biggest drugs company based in low-tax Ireland.
The so-called tax inversion deal comes more than year after Pfizer failed in a similar style, tax-driven £69 billion bid for AstraZeneca which would have seen it relocate to the UK.
This all-share deal will see Pfizer redomicile itself to Ireland, where Allergan is already based, although both companies’ shares are listed on the New York Stock Exchange.
Such a move would see Pfizer escape the US’s 35% corporation tax in favour of Ireland’s ultra-low rate of 12.5%.
Last year and again last week the US Treasury, under orders from Obama, tried to tighten rules against such inversion deals.
But experts said the deal would not be prevented by those changes.
The new group would have combined sales of $60 billion, which would put it way ahead of the current world leader in drugs sales, Merck, with sales of $40 billion.
The takeover will also be the largest of the year, comfortably outstripping AB InBev’s $107 billion takeover of rival brewer SABMiller.