AbbVie to Buy Shire for $54.8 Billion

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July 18 (Bloomberg) -- AbbVie Inc. agreed to buy Shire Plc for 32 billion pounds ($54.8 billion), becoming the largest U.S. company to ever take a foreign address to lower its taxes. Olivia Sterns reports on “In The Loop.” (Source: Bloomberg)

Abbvie made several offers.

It purchased scheier for $54.8 billion.

-- shire for 54.8 billion dollars.

I want to bring in olivia sterns.

This comes amid a huge surge in deals.

A lot of people are wondering is this really just for tax reasons or is there a key strategy here?

The way to look at it is that abbvie would not have gone for a big takeover target if there were not for the tax benefit, but there is a reason.

Shire has a couple of rare disease drugs that are very lucrative.

They also have a promising drug for adhd which is a growth industry.

Abbvie needed to do a big deal because they are so heavily dependent on this one drug which is for arthritis which is a $14 billion drug for them.

It brings in half the revenue.

They were going to do a deal.

It is palatable for lawmakers to get out of paying taxes.

You have an obligation to shareholders though.

There are several lawmakers who have woken up to this move and have said, we are not going to let this happen.

They all will cup when they saw pfizer trying to buy astrazeneca.

They are awake to the threat.

Jack lew wrote to congress this week.

He wants to see action immediately.

He is talking about a retroactive law.

Ron wyden says he has a bill.

That is what the holdup has been about.

This is the fifth time they have put forth a bit.

-- a bid.

A very hefty breakup fee of 3%, reflecting a fear that something could happen to break down the deal, such as lawmakers coming in and taking away the tax incentive.

Anything else to derail the deal?

This text has been automatically generated. It may not be 100% accurate.


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