(Reuters) — U.S. drugmaker Pfizer Inc and Ireland-based Allergan Plc formally announced that they were scrapping their $160 billion merger, marking a big win for President Barack Obama who has been pushing to curb tax-slashing “inversion” deals.
The announcement followed the unveiling of new U.S. Treasury rules on Monday aimed at curbing such deals.
The merger would have allowed New York-based Pfizer to cut its tax bill by redomiciling to Ireland, where tax rates are lower.
A source familiar with the matter told Reuters on Tuesday that the deal would be terminated.
Pfizer said on Wednesday it had agreed to pay Allergan $150 million for reimbursement of expenses associated with the deal.