There are reports this morning that Pfizer and Allergan have begun merger talks - but no deal has been agreed.
The Wall Street Journal has published a story which says that Pfizer is in preliminary takeover talks with Allergan - and that the pair could create the world’s largest pharmaceutical group with a market capitalisation of well over $300bn.
Pfizer employs about 4,000 people in eight plants across Ireland manufacturing a range of cardiovascular drugs, vaccines, animal health products and Viagra, while Allergan employs close to 1,000 people in Westport principally in R&D and production of Botox.
Allergan, whose headquarters is in Dublin, had a market value of about $113bn prior to news of the talks, so any deal is likely to offer a significant premium to this value for the company’s shareholders.
The deal would not only bring benefits in terms of scale and efficiency but also enable Pfizer to move its tax domicile to Ireland, a so-called tax inversion, and thereby massively reduce its current effective US tax rate of more than 25%.
