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NORTH CHICAGO, Ill. and DUBLIN—AbbVie Inc. and Allergan plc have entered into a definitive transaction agreement, under which AbbVie will acquire Allergan in a cash and stock transaction for a transaction equity value of approximately $63 billion. This price is based on the closing price of AbbVie’s common stock of $78.45 on June 24, 2019.
 
“This is a transformational transaction for both companies and achieves unique and complementary strategic objectives,” said Richard A. Gonzalez, chairman and chief executive officer, AbbVie. “The combination of AbbVie and Allergan increases our ability to continue to deliver on our mission to patients and shareholders. With our enhanced growth platform to fuel industry-leading growth, this strategy allows us to diversify AbbVie's business while sustaining our focus on innovative science and the advancement of our industry-leading pipeline well into the future.”
 
AbbVie will continue to be incorporated in Delaware as AbbVie Inc. and will have its principal executive offices in North Chicago, Ill. Gonzalez will continue to be AbbVie’s chairman and chief executive officer. Two members of Allergan’s board will join AbbVie’s board upon completion of the transaction, including Brent Saunders, chairman and chief executive officer of Allergan.
 
The combined company will consist of several attractive franchises with leadership positions across immunology, hematologic oncology, medical aesthetics, neuroscience, women’s health, eye care and virology.  Allergan’s product portfolio is expected to be enhanced by AbbVie’s commercial strength, expertise and international infrastructure.
 
AbbVie’s enhanced growth platform is expected to grow at a high-single digit annual growth rate well into the next decade, from more than $30 billion in 2020. This transaction is expected to be 10% accretive to adjusted earnings per share over the first full year, following the close of the transaction, with peak accretion of greater than 20%. ROIC is expected to exceed AbbVie’s cost of capital within the first full year.
 
“This acquisition creates compelling value for Allergan’s stakeholders, including our customers, patients and shareholders. With 2019 annual combined revenue of approximately $48 billion, scale in more than 175 countries, an industry-leading R&D pipeline and robust cash flows, our combined company will have the opportunity to make even bigger contributions to global health than either can alone,” added Saunders. “Our fast-growing therapeutic areas, including our world class medical aesthetics, eye care, CNS and gastrointestinal businesses, will enhance AbbVie’s strong growth platform and create substantial value for shareholders of both companies.”
 
Under the terms of the agreement, Allergan shareholders will receive 0.8660 AbbVie shares and $120.30 in cash for each Allergan share that they hold, for a total consideration of $188.24 per Allergan share. The transaction represents a 45% premium to the closing price of Allergan’s shares on June 24. The transaction is also subject to certain regulatory approvals and approval by Allergan’s shareholders.

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