Replies to post #197591 on Biotech Values

[poorgradstudent]

PFE / AGN:

Any idea on how we can get an idea of the magnitude of "taxable" in this case? Since AGN is receiving PFE shares, I'm not sure how I as a PFE shareholder can model the tax implications.

[DewDiligence]

Symmetric breakup fees in PFE-AGN deal (from SEC filings):

• General Case: $3.5B payable by withdrawing party to non-withdrawing party.

• Special Case 1: $1.5B payable by the company whose shareholders vote against the deal to the company whose shareholders vote in favor of the deal. (If both companies’ shareholders vote against the deal, there is no breakup fee.)

• Special Case 2: $400M if a company withdraws due to a material change in law (presumably tax law). In this case, the withdrawing party would almost certainly be PFE.

The low breakup fee in Special Case 2 suggests that the companies think a material adverse change in tax laws before deal closing is fairly likely.

[DewDiligence]

PFE-AGN-merger CC slides:

https://www.premierbiopharmaleader.com/media/1173/pfe-agn-ir-presentation-final.pdf

[DewDiligence]

PFE increases annualized dividend payout to $1.20 (from $1.12):

http://finance.yahoo.com/news/pfizer-declares-first-quarter-2016-213000658.html

At the current share price, the new payout rate represents a yield of 3.7%.

[DewDiligence]

PFE—4Q15 results and pipeline update (long version):

http://www.pfizer.com/system/files/presentation/Q4_2015_PFE_Earnings_Press_Release_asdlkfsdaf.pdf

2015 results include HSP only for 4Q15 (and for month of Sep 2015 for US operations).

PFE says there is no reason why AGN deal should not close in 2H16.