Allergan signs deal to merge with US drug giant
US drug manufacturer Pfizer said it has agreed to merge with Irish rival Allergan in a deal worth $160bn (£106bn), making it the biggest deal in pharmaceuticals history.
The firms said the merger would create an industry leader that would have more than 100 treatments in mid-to-late-stage development.
Allergan shareholders will receive 11.3 shares of the combined company for each of their Allergan shares, and Pfizer investors will receive one share of the combined company for each of their Pfizer shares.
Last year, Anglo-Swiss rival AstraZeneca fought off a £69bn takeover bid from US rival Pfizer, saying the bid undervalued the business.
The merger is also the largest so-called inversion deal in corporate history, a tax-saving manoeuvre in which a US company reorganises in another country with a lower corporate tax rate.
The US corporate tax rate of 35% is one of the highest in the world, and compares with Ireland's rate of 12.5%.
US efforts to curb the practice have so far proven ineffective.
Botox maker Allergan is based in Dublin, but runs much of its operations out of New Jersey in the US.
The combined business, which will be named Pfizer, will be legally domiciled in Ireland, but will have its global operational headquarters in New York.
Pfizer chairman and chief executive Ian Read said: "The proposed combination of Pfizer and Allergan will create a leading global pharmaceutical company with the strength to research, discover and deliver more medicines and therapies to more people around the world."
Allergan chief executive Brent Saunders said the deal brought together "two biopharma powerhouses".
Mr Saunders added: "This bold action is the next chapter in the successful transformation of Allergan, allowing us to operate with greater resources at a much bigger scale."