James F. McDonough
Of Counsel
732-568-8360 jmcdonough@sh-law.comFirm Insights
Pfizer, AstraZeneca deal may be dead in the water
Author: James F. McDonough
Date: June 4, 2014
Key Contacts
Back
Tax inversions have been covered heavily in financial media in recent months, causing a significant stir of public opinion regarding corporate tax rates and some discussion of government action.
One of the most significant inversions to be considered is the one between Pfizer, the second largest global pharmaceutical company, and AstraZeneca, the eighth, according to the BBC. A merger between the two companies would serve to significantly reduce Pfizer’s tax liabilities by allowing it to redomicile in Europe, and cause the new company to be the largest pharmaceutical company in the world. Pfizer’s 2013 revenue came in at $52 billion, AstraZeneca’s was $26 billion and Johnson & Johnson led the world’s drug companies at $71 billion.
The possible merger between these two companies led to calls for action on the corporate tax rate from both sides of the U.S. political aisle. Politicians are split, however, as to whether litigation should limit inversions or lower the corporate income tax rate.
The public may not have to worry about this specific merger going through, however, as the smaller company has rejected Pfizer’s final offer of £69 billion, according to The Guardian. Leif Johansson, chairman for AstraZeneca, said that Pfizer’s offer of £55-a-share fell short of the price that the U.S. company was told was necessary.
Pfizer said May 16 that it would pay £53.50 per share, an offer that AstraZeneca rejected, the news source reported. The latter company said that weekend that the price would need to be at least 10 percent higher, leading to a valuation of £74 billion. Pfizer raised its offer to £55 per share, and raised the cash portion of its bid to 45 percent from a previous 33 percent. The rest of the offer is payable in Pfizer shares.
While inversions remain problematic in the world of U.S. corporate tax law, it seems that this particular merger is unlikely to happen. Pfizer has already said that it will not be pursuing a hostile takeover.
- Practices: Corporate Tax Planning, Tax and Trusts & Estates, Corporate Transactions & Business
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
Guardianships in New Jersey: When a Loved One Can No Longer Manage Personal or Financial Affairs
When a family member can no longer make important decisions for themself, the question is often not whether the family will step in, but whether they have the legal authority to do so. A spouse may manage household finances, or an adult child may arrange medical care and pay bills. Still, informal assistance does not […]
Author: Marc J. Comer
New Jersey’s Revised UHAC Regulations: What Residential Developers Need to Know About Affordable Housing Commitments
New Jersey residential developers with affordable housing obligations should carefully review their existing approvals, development agreements, and proposed deed restrictions in light of the State’s revised UHAC regulations (Uniform Housing Affordability Controls). The regulations, which took effect on November 6, 2025, significantly change the administration and physical requirements for affordable housing units. For developers with […]
Author: Wendy Rubinstein Quiroga
“No Comment” Culture: Why Silence Is Often the Riskiest Legal Strategy
A “no comment” response is sometimes the right call when a legal problem arises. As a blanket policy, however, it lets allegations go unanswered, deadlines pass, evidence disappear, and manageable disputes grow into expensive litigation. The businesses that fare best are usually the ones that say little publicly while acting decisively behind the scenes. When […]
Author: Sean M. Pena
Utility-Scale Battery Storage Projects: A Legal Roadmap for Developers, Property Owners and Other Stakeholders
Utility-scale battery energy storage systems (BESS) are becoming an increasingly important component of the electric grid throughout New Jersey, New York, and Pennsylvania. As renewable generation expands, electricity demand increases and grid operators seek greater flexibility, battery storage can help balance supply and demand while providing additional capacity and reliability. For developers, battery storage presents […]
Author: Nicholas Wall
Navigating Disputes: Hire a Partnership Dispute Lawyer
A falling out between partners can be disastrous for any business. In many cases, the partnership will not survive. If you are in an unworkable situation with your partners, it may be time to consult a partnership dispute lawyer experienced in handling partnership breakups and dissolutions before the situation deteriorates any further. It is easy […]
Author: Jay McDaniel
Section 363 Sales in Bankruptcy: What Businesses, Lenders, and Buyers Need to Know
When a company enters Chapter 11 bankruptcy, many assume the process will culminate in a lengthy reorganization plan. However, distressed businesses are increasingly being sold through a different mechanism — a sale under Section 363 of the United States Bankruptcy Code. A Section 363 sale allows a company, as a debtor-in-possession in bankruptcy, to sell […]
Author: John D. Giampolo
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.