Allergan and Pfizer Inc. are in talks for a potential merger. The company’s confirmed news of their talks on Thursday.
In separate statements that used many of the same words, the company’s said they are engaged in “preliminary friendly discussions” about a potential merger.
They admit that no agreement has been reached and that there is no certainty the deal would move forward.
Allergan, based in Dublin, and Pfizer disclosed the talks Thursday under Irish takeover rules.
Allergan says regardless of the merger’s success, it is still planning to divsest its global generics business to Teva Pharmaceutical Industries Ltd.
Allergan had a market capitalization Wednesday of nearly $113 billion. If it moves forward it could be the largest merger during a year of record-breaking acquisitions.
Shares of Allergan jumped 8.9% to $312.85 in Thursday morning trading, while Pfizer shares slid 0.8% to $35.18.
Pfizer commands a market cap of $219 billion.
Critics are already blasting the New York-based Pfizer for a maneuver that could allow it to lower its corporate tax rate. Allergan, because it is based in Dublin, has a significantly lower tax rate than companies in the U.S.
Pfizer Chief Executive Ian Read said Pfizer is at a “tremendous disadvantage” under the U.S. corporate tax code and that his company is competing against foreign companies “with one hand tied behind my back.”
No further details are available at this time.