Pfizer (PFE) and Allergan (AGN) today announced agreement on a merger between the companies that, if everything gets approved, should take place in the second half of 2016:
This is a tax inversion in which Allergan (an Irish company) will be "buying" the much bigger Pfizer.
If your investment club owns either of these two companies here is what will happen with your shares:
If you own Allergan
You will receive 11.3 shares of the New Allergan for each existing Allergan share you own. This will be a non-taxable split.
If you own Pfizer
You will receive either cash or Allergan shares. You will owe taxes on the difference between your basis in your PFE shares and the value of the shares or cash that you receive.
This is information that you should be aware of as you make your portfolio decisions.
Laurie Frederiksen Invest with your friends! www.bivio.com