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Allergan's Big Deal: A Buyout, Not A Split, Appeases Wary Investors

 
• By Mandy Jackson

Allergan was expected to announce soon that it would follow its shareholders' advice and split the company in two, but it's being acquired by AbbVie for $63bn instead, finally giving investors a big boost in their Allergan holdings after years of decline.

merger and acquisition business concepts, join company on puzzle pieces, 3d rendering
A merger was the answer to Allergan's woes, not a split. • Source: Shutterstock

The unexpected announcement on 25 June that Allergan PLC will be acquired by AbbVie Inc. for $63bn far exceeded expectations that Allergan would appease its investors by splitting the company in two after years of watching its stock price sink.

Allergan's value surged on its reputation of aggressive dealmaking, rising above $300 per share based on rumors of Pfizer Inc.'s interest in buying the company and remaining near that level after a $160bn deal between the two firms was announced in November 2015. (Also see " Pfizer, Allergan In Third-Biggest Merger Ever " - Scrip, 23 November, 2015

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