New York / Frankfurt the largest merger ever in the pharmaceutical industry has failed.
Because of a tightening of US tax laws blurted 160 billion dollar takeover of Irish Botox manufacturer Allergan by the US pharmaceutical giant Pfizer. The proposed merger was terminated by mutual agreement, Pfizer said on Wednesday. Background new measures by the US government against tax avoidance in the context of such takeovers. For the CEO of Viagra producer Pfizer, Ian Read, it’s the next setback in its long-pursued goal of tax to settle the Group outside the United States. Already in 2014 he was beaten with his offer over 118 billion for the British-Swedish AstraZeneca.
In his last year in office, US President Barack Obama may thus still celebrate a significant success in its efforts to tighten the US tax laws. Obama had areas controlled by Republicans US Congress several times urged to be active when it comes to mergers laying offices abroad, there to pay lower taxes. So far, however, little had happened. On Monday the US Treasury but new rules announced aimed at this type of tax avoidance. These stipulate, inter alia time limits for consideration of acquisitions of foreign companies in the US.
Allergan gained through a series of billion-acquisitions in the past three years only the necessary size which Pfizer would have allowed to move after the merger the company headquarters to Ireland. The company was formed by 66 billion dollar takeover by the rival Actavis, who had previously swallowed itself, among other things, the US pharmaceutical company Forest Laboratories for 25 million dollars. Allergan and Pfizer were planning to settle after the merger the world’s largest drug manufacturers headquartered in the European country, but not the operational activities. The corporate tax is in the United States at 35 percent, in Ireland at only 12.5 percent. Pfizer could thus secure annual savings of more than a billion dollars.
NO NEW INDUSTRY PRIMUS
with the acquisition, consolidated would with an annual turnover of more than $ 60 billion emerged. He would have the Swiss competitor Novartis from top spot supplanted as the world’s largest manufacturer of prescription drugs. The merger not only Viagra and Botox, but also a number of popular painkillers, Alzheimer’s drugs, lipid-lowering, eye drugs and preparations against pneumonia had come together under one roof. According to the merger agreement both sides could cancel the deal if the new entity would be classified as US group due to changes in tax law and therefore fell away the tax advantages. Pfizer to pay $ 150 million to the cancellation of the merger Allergan. The merger should be actually completed in the second half.
In the United States in recent years, many companies have their headquarters moved to large mergers abroad, which brings significantly lower tax payments with them. Currently about yet of the US auto supplier Johnson Controls plans to buy the Irish fire protection provider Tyco for $ 16.5 billion and will relocate its headquarters in the low-tax country. This called inversion tactic has become a political issue in America. Even the favorite presidential candidate of Democrats and Republicans, Hillary Clinton and Donald Trump, here are exceptionally agree that a bolt has to be advanced. The government in Washington had issued 2014 first measures. Then blurted about the planned 55-billion-dollar merger between Shire and AbbVie.
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