The drugmaker AbbVie says it is having second thoughts about its deal to combine with British counterpart Shire after the U.S. government created new limitations on the tax benefits of incorporating overseas.
North Chicago-based AbbVie said Tuesday it notified Shire that its board intends to reconsider the recommendation it made in July that its shareholders back the proposed combination worth roughly $55 billion.
AbbVie says it hasn’t called off the deal, but its board needs to weigh whether it is still a good idea in light of new tax regulations announced by the U.S. Treasury in September. The regulations aim to crack down on U.S. companies shifting their ownership abroad to shirk paying U.S. taxes.
In announcing their deal in July, the two drugmakers said they planned to create a new company incorporated on the British island of Jersey, where Shire is incorporated.
Shire: AbbVie should proceed with $55B acquisition 10 key facts about corporate inversions
