Pfizer and Allergan speed up $150bn mega-merger talks
Pfizer has hastened discussions with Allergan over a potential acquisition, according to reports.
Ireland-base Allergan confirmed at the end of last month it was in talks to join forces with its US rival, but according to a source close to the matter the decision making process has picked up pace.
Pfizer is said to be negotiating an offer of between $370 and $380 per Allergan share, valuing the company at $150bn. However, the source added a deal was far from certain following news that the US Treasury plans to tighten its tax evasion rules further. Both Allergan and Pfizer declined to comment.
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Pfizer is currently headquartered in the US, but being domiciled in Ireland would allow it to avoid paying a large amount of US corporation tax.
If the deal goes ahead, the resulting company would be the largest drugs firm in the world with a market capitalisation of $300bn (£196bn). This would put it ahead of Johnson & Johnson, which has a value of $277bn.
From Allergan's point of view, Pfizer is in a good position in terms of growth. In October, it reported a six per cent increase in revenue to $12.2bn in the third quarter, and improved its full-year outlook on the back of this.
Shares in Allergan, which like Pfizer is listed on the New York Stock exchange, declined 1.33 per cent in pre-market trading in light of the rumours. Pfizer shares fluctuated slightly above and below last night's closing figure.