Bankers on the edge as huge payday is in danger

Ronnie Sweating Large

Is it all falling apart ?

After putting together the biggest transaction in a record year for deals, investment bankers on Pfizer’s $160bn merger with Allergan may be about to watch millions of dollars in fees evaporate.

Bloomberg News reports that the deal could be in jeopardy after the U.S. took tougher steps this week to limit corporate inversions, where a company adopts a foreign address to cut its tax bill. Pfizer structured the deal to take advantage of Allergan’s Dublin headquarters where the corporate tax rate is more favorable.

At stake for advisers is an estimated $350m, according to previous estimates from consultants Freeman & Co. Pfizer was expected to pay $120m to $150m in fees while Allergan’s bankers would split $160m to $200m. Goldman Sachs, Centerview Partners, Guggenheim Partners and Moelis worked for Pfizer. Allergan was advised by JPMorgan and Morgan Stanley.

The loss of this deal could be particularly harmful for smaller investment banks, which had gained standing in M&A league tables after working on a mega-deal.

To access the complete Bloomberg News article hit the link below:

Bankers Risk Losing Millions If Pfizer-Allergan Deal Falls Apart

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