LONDON/NEW YORK (Reuters) – The U.S. Treasury’s move to curb deals that allow U.S. companies to escape high taxes at home wiped a combined $12.3 billion off the shares of nearly a dozen companies on both sides of the Atlantic on Tuesday, as investors reacted to the surprisingly far-reaching action.
But it was unclear whether the tougher stance adopted by the Obama administration on “inversion” deals that allow companies to escape high U.S. taxes by reincorporating abroad, which followed a wave of public criticism, would end any of the handful of deals currently in the works.
LONDON (Reuters) – Shares in drugmakers AstraZeneca (AZN.L: Quote, Profile, Research, Stock Buzz) and Shire (SHP.L: Quote, Profile, Research, Stock Buzz) both fell more than 5 percent on Tuesday after the U.S. Treasury took steps to curb “inversion” deals that allow companies to escape high U.S. taxes by reincorporating abroad.
The move could jeopardize an agreed deal for AbbVie (ABBV.N: Quote, Profile, Research, Stock Buzz) to buy Shire for $55 billion and deter Pfizer (PFE.N: Quote, Profile, Research, Stock Buzz) from making another attempt to acquire AstraZeneca, after a $118 billion takeover attempt failed in May.
LONDON (Reuters) – GlaxoSmithKline may have closed one chapter in a saga of corruption allegations by accepting a $489 million fine in China, but the drugmaker has its work cut out to win back skeptical investors.
That means continued pressure on Chief Executive Andrew Witty, seen not so long ago as one of the sector’s star managers, who is under fire for allowing the erosion of GSK’s all-important U.S. business just as much as for the woes in China.