Pfizer and Allergan scrap $160 billion ‘inversion’ deal: Reuters

(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.