Tax for the CFO: Should Pfizer Acquire Allergan?

Tax for the CFO
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Tax for the CFO
Executive Summary
In most instances, before merging, the companies should compare the advantages and risks they are likely to incur. After considering all the factors between Pfizer Inc. and Allergan plc, it is evident that the two companies should merge. The main reason is the benefits that Pfizer Inc. is likely to enjoy outweighs the risks. For instance, by merging the two companies, the company will likely enjoy improved financial muscle since the two companies will combine the finances. This process will help the company to have an outstanding dominance which will help it to enjoy other benefits. Moreover, embracing these measures will help it to enjoy more skills. Since the companies are not looking forward to layoff some employees, they will enjoy outstanding skills in the merged company. Furthermore, embracing this measure will help the company reduce the tax. For instance, since the companies are looking forward to changing their residence to Ireland, they will have to pay less tax for their income. This process will help the company to use these finances for other important reasons. These two companies should merge since a merger will help them to have outstanding benefits.
Introduction
Over the years, there has been an increased discussion regarding mergers. The main reason is that the world has experienced the highest number of mergers. In most instances, organizations look forward to mergers due to the benefits they are likely to enjoy. Some of the benefits include having more finances, additional skills, and reduced amount of tax that it will incur. However, despite having goodwill, there have been instances where some mergers have turned out costly. For example, there have been instances where some companies have suffered from mismanagement from mergers. Therefore, organizations should look for the benefits and risks they will likely incur if they merge. For instance, Pfizer Inc. and Allergan plc should consider both sides of the merger, making an informed decision. Since the financial officer usually decides whether the companies should engage in mergers, Frank D' Amelio should use his outstanding skills to advise the company on the right route.
Why is Pfizer seeking a merger? Does Allergan Fit Pfizer’s needs?
In most instances, there are reasons which usually trigger the company to seek a merger. Similarly, there are some reasons why Pfizer is looking for a merger with Allergan. Before accepting the merger, Pfizer should check whether Allergan fits its needs. Pfizer Inc....