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
What Founders Can Learn From Start-up Suits
High-profile founder litigation is more than just a media spectacle. For startup founders, these cases underscore the legal and structural risks that can arise when rapid growth outpaces formal oversight. While launching a new company can be both an exciting and deeply rewarding endeavor, founders must be mindful that it also comes with significant risks. […]
Author: Dan Brecher
Corporate Governance Reviews: A Practical Guide for New Jersey Companies
Every New Jersey company should periodically evaluate its governance framework. Strong corporate governance protects directors and officers, builds investor confidence, reduces litigation exposure, and positions a company for sustainable growth. The first quarter of the year is a great time to evaluate your corporate governance practices and perform any routine maintenance needed to keep that […]
Author: Ken Hollenbeck
What to Do After Being Served with a Lawsuit: Steps to Protect Your Legal Rights
Being served with a lawsuit is one of the most stressful legal events a business or individual can face. Whether the claim involves a contract dispute, an employment matter, an intellectual property issue, or another legal challenge, the actions you take in the first few days can significantly shape the outcome of your case. Acting […]
Author: Robert E. Levy
Will 2026 Be a Banner Year for SPACs? Understanding the Risks and Opportunities
Special Purpose Acquisition Companies (SPACs) continue to gain momentum as we move through 2026. After enduring a significant contraction following the 2021 boom and the regulatory scrutiny that followed, SPAC activity rebounded sharply in 2025 and now carries forward into 2026 with real momentum. The SPAC resurgence reflects broader improvements in both market conditions and the […]
Author: Dan Brecher
Why Compliance Monitoring Matters for NY and NJ Businesses
Compliance programs are no longer judged by how they look on paper, but by how they function in the real world. Compliance monitoring is the ongoing process of reviewing, testing, and evaluating whether policies, procedures, and controls are being followed—and whether they are actually working. What Is Compliance Monitoring? In today’s heightened regulatory environment, compliance […]
Author: Dan Brecher
When Are New Jersey Business Owners Personally Liable for Corporate Debt?
New Jersey personal guaranty liability is a critical issue for business owners who regularly sign contracts on behalf of their companies. A recent New Jersey Supreme Court decision provides valuable guidance on when a business owner can be held personally responsible for a company’s debt. Under the Court’s decision in Extech Building Materials, Inc. v. […]
Author: Charles H. Friedrich
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.