AbbVie aborts its plan to acquire Shire

U.S. drug company AbbVie is aborting its plan to acquire Irish pharmaceutical company Shire for $55 billion due to the U.S. Department of Treasury’s regulatory changes aimed at limiting the amount of businesses changing locations for lower business tax rates, Reuters reported on October 20.

Abbvie dropped its multi-billion dollar bid for Shire after its board of directors decided that the transaction will no longer be beneficial for the company. AbbVie’s Chief Executive, Richard Gonzales, said the amendments made by the Treasury “created an environment of risk and uncertainty” that would make the acquisition unfavorable for stakeholders.

The Chicago-based pharmaceutical company will pay a $1.64 billion breakup fee for deciding to withdraw from the deal.

Legislative changes may directly impact business transactions you are planning to undertake. Our team of Cedar Rapids business law attorneys at Arenson Law Group, PC, is always abreast with the current business law issues that may affect your business endeavors. Call us at (319) 363-8199 today to discuss your legal needs.