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Shire share price falls over AbbVie deal worries, dragging pharma shares and FTSE down
Shire shares fell almost 30 per cent in early trading this morning after its potential buyer AbbVie said it was reconsidering the $54bn (£32bn) deal.
AbbVie said it was rethinking the deal due to the US Treasury’s crackdown on the tax loophole that allows US firms to move headquarters to another country via a takeover in order to pay a lower rate of corporate tax outside of the US.
The news dragged down fellow drugmakers AstraZeneca, Smith & Nephew and GSK as it signalled the wider sector may no longer be as ripe a target for takeovers as it has been previously.
AstraZeneca, recently targeted by US giant Pfizer, saw shares fall as low as 4.5 per cent this morning, while Smith & Nephew shares fell nearly four per cent and GSK was down 1.4 per cent.
The pharmaceutical shares drove FTSE 100 and FTSE Eurofirst 300 losses this morning.