Arab Today, arab today us rules against tax mergers sink allergan shares
Last Updated : GMT 04:41:48
Arab Today, arab today
Arab Today, arab today

US rules against tax mergers sink Allergan shares

Arab Today, arab today

Arab Today, arab today US rules against tax mergers sink Allergan shares

A deal, in which the larger US-based Pfizer would be taken over by Allergan and then move its corporate tax domicile to Ireland
New York - AFP

Shares of Dublin-based Allergan plunged Tuesday on doubts about the prospects of its merger with Pfizer following new US restrictions on cross-border deals designed to avert US taxes.

The two drugmakers said that they were reviewing their $160 billion merger deal announced last year after the US Treasury revealed new regulations to stymie "inversion" takeovers that would impact government tax receipts.

"We are conducting a review of the US Department of Treasury's actions announced today," they said in a joint statement late Monday. "Prior to completing the review, we won't speculate on any potential impact."

The deal, in which the larger US-based Pfizer would be taken over by Allergan and then move its corporate tax domicile to Ireland, is structured to reduce Pfizer's tax rate from about 25 percent in the US to 17-18 percent in Ireland.

The prospect it could be blocked sent Allergan shares falling sharply.

Near 1520 GMT, Allergan was down 16.3 percent at $232.50, while Pfizer added 1.0 percent at $31.01.

The Treasury's new rules make it more difficult for companies involved in stock-based merger deals to achieve the minimum foreign ownership required to avoid US corporate tax liability.

An acquirer in such a case would be barred from counting as foreign parent stock the acquisitions of US companies in earlier, recent inversion deals.

The rules also seek to block companies in such deals from stripping profits from US subsidiaries by setting up sizable loans to the subsidiaries from the parent abroad that are not related to concrete investments.

The rules "appear targeted to specifically derail Pfizer-Allergan," said a note from Credit Suisse.

Allergan has grown rapidly via acquisitions of US companies Forest Labs in 2014 and Warner Chilcott in 2013 that cut their US tax burdens. These acquisitions were actually made by Dublin-based Actavis, which in 2015, bought US-based Allergan and took its name.

"Clearly, these (Treasury) actions seem to have been targeted to block the Pfizer-Allergan merger," said BMO Capital Markets.

"Based on our initial understanding of Treasury's recent proposals . . . . we believe the tax benefits of the Pfizer and Allergan merger will likely be significantly diminished based on Treasury's recent actions," BMO said.

 

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today us rules against tax mergers sink allergan shares Arab Today, arab today us rules against tax mergers sink allergan shares

 



Arab Today, arab today
Arab Today, arab today Fadi explains secrets of  Nancy Ajram's newlook

GMT 18:23 2017 Friday ,24 February

Fadi explains secrets of  Nancy Ajram's newlook
Arab Today, arab today Tourist guide explains types of tourism

GMT 18:28 2017 Saturday ,25 February

Tourist guide explains types of tourism
Arab Today, arab today Expresses Algerian history by woody figures

GMT 13:26 2017 Friday ,24 February

Expresses Algerian history by woody figures
Arab Today, arab today Iran complying with nuclear deal

GMT 07:14 2017 Saturday ,25 February

Iran complying with nuclear deal
Arab Today, arab today Ayat Abaza says state TV presented major stars

GMT 03:52 2017 Sunday ,26 February

Ayat Abaza says state TV presented major stars

GMT 05:58 2017 Saturday ,25 February

US new home sales rise in January

GMT 05:46 2017 Saturday ,25 February

Record unemployment in Brazil

GMT 05:33 2017 Saturday ,25 February

Indian wind power tariffs fall

GMT 05:27 2017 Saturday ,25 February

German construction sector grows
View News in Arabic - Business: اقتصاد دولي
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today Reading therapy relieves mental disorders

GMT 15:39 2017 Friday ,24 February

Reading therapy relieves mental disorders
Arab Today, arab today UK appoints 1st Scotland Yard chief in 188 years

GMT 05:14 2017 Thursday ,23 February

UK appoints 1st Scotland Yard chief in 188 years
Arab Today, arab today Penguins in the age of dinos

GMT 11:44 2017 Saturday ,25 February

Penguins in the age of dinos
Arab Today, arab today Pluto's unruly moons

GMT 06:31 2015 Thursday ,04 June

Pluto's unruly moons
Arab Today, arab today 'Constructive' Vauxhall talk with union

GMT 08:54 2017 Saturday ,25 February

'Constructive' Vauxhall talk with union
Arab Today, arab today Tesla back into red but revenue grows

GMT 07:27 2017 Thursday ,23 February

Tesla back into red but revenue grows
Arab Today, arab today Actress Lobna Abdel Aziz proud of her career

GMT 06:08 2017 Thursday ,23 February

Actress Lobna Abdel Aziz proud of her career
Arab Today, arab today Ex-yoga missionary unleashes rage

GMT 12:16 2017 Thursday ,23 February

Ex-yoga missionary unleashes rage

GMT 07:36 2017 Wednesday ,22 February

Wafaa Amer is happy for Sherihan’s return

GMT 12:35 2017 Tuesday ,21 February

63-Year-Old Woman Delivers Baby

GMT 22:42 2017 Thursday ,23 February

Nasima Gamei revives heritage in jewelries

GMT 10:28 2017 Wednesday ,22 February

Milan laughs while Rome cries

GMT 20:33 2017 Friday ,17 February

To release new antiques collection

GMT 10:20 2017 Thursday ,23 February

Brazil's top diplomat resigns

GMT 11:54 2017 Thursday ,23 February

Saudis await visitors but will they come?

GMT 13:12 2015 Saturday ,09 May

Sheikh Sultan opens Sharjah Centre

GMT 20:02 2017 Tuesday ,21 February

Nohan Seyam designs beautiful accessories
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday