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BUSINESS A25
Monday 23 November 2015
Report: Pfizer, Allergan close to $150 billion merger deal
NEW YORK (AP) — Pfizer nent. The boards of each in a country with a lower lergan buying New York- Buying Allergan would add
Inc. and Allergan PLC are company were expected corporate tax rate. Inver- based Pfizer, according to its brand-name medicines
on the cusp of reaching a to approve the agreement sions have become a hot the newspaper’s report. for eye conditions, infec-
$150 billion deal that would Sunday and it could be an- political topic, raising the Pfizer, the maker of Viagra tions and heart disease to
create the world’s larg- nounced Monday. ire of lawmakers in Wash- and Lipitor, has been deal- Pfizer’s extensive portfolio
est drugmaker by sales, Pfizer and Allergan rep- ington and public interest ing with tough competition of vaccines and drugs for
The Wall Street Journal re- resentatives declined to groups. from generics and pressure cancer, pain, erectile dys-
ported Sunday, citing un- comment. Botox maker Allergan is from investors to stimulate function and other condi-
named people familiar If a deal is reached, it based in Ireland but runs growth. Generic competi- tions. It would also allow
with the matter. would be the biggest ever much of its operations out tion is expected to cut Pfiz- Pfizer, the world’s second-
According to the newspa- merger in health care and of Parsippany, New Jersey. er’s sales by $28 billion from biggest drugmaker by
per, terms of the deal in- the largest “inversion” To help secure that lower 2010 through next year. It’s revenue, to surpass Swit-
clude 11.3 Pfizer shares for ever — that’s a tax-saving tax rate, the deal will be done three sizeable deals zerland’s Novartis AG and
every Allergan share, along maneuver in which a U.S. technically structured as since 2000 to boost rev- regain the industry’s top
with a small cash compo- company reincorporates a reverse merger, with Al- enue. spot.q
Abercrombie cuts back on sales and it pays off in 3Q
NEW ALBANY, Ohio (AP) — basis, over last year. A shopper carries her Abercrombie & Fitch purchase in Phoenix. Retailer Abercrombie & Fitch
Taking a path at odds with For the period ended Oct.
other retailers who have 31, Abercrombie & Fitch reported quarterly earnings on Friday, Nov. 20, 2015. (AP Photo/Ross D. Franklin)
slashed prices to lure cus- earned $41.9 million, or 60
tomers through the door, cents per share. A year Richard Jaffe, an analyst from recently opened or decline at its Banana Re-
Abercrombie & Fitch fo- earlier it earned $18.2 mil- with Stifel, closed. public locations. Its Old
cused instead on reinvigo- lion, or 25 cents per share. Nicolaus We believe ANF’s But that decline in the Navy stores did much bet-
rating its brand and it paid The performance looked momentum is sustainable current environment ap- ter, however. Abercrom-
off in the third quarter as even better thanks to an Sales at stores open at least peared palatable for in- bie’s Hollister locations led
profits more than doubled. improved tax situation, a year dipped 1 percent. vestors. Late Thursday, the way, where same-store
Investors, rattled by weak which turned into $5.9 mil- The metric is a key indica- Gap reported a 4 percent sales rose 2 percent, which
sales and dismal forecasts lion on the plus side this tor of a retailer’s health be- decline at name brand offset some weakness at
from the sector, rewarded quarter. Last year, the cause it excludes volatility stores, and a 12 percent name brand stores.q
Abercrombie this week- company incurred an ex-
end. Shares jumped more pense of approximately
than 20 percent Friday, the $9.6 million.
biggest one-day percent- Earnings, adjusted for non-
age gain in three years. recurring gains, were 48
“Our third quarter results cents per share. That blew
exceeded our expecta- past the per-share projec-
tions coming into the quar- tions of 19 cents on Wall
ter and provide the stron- Street, according to a poll
gest validation yet that by Zacks Investment Re-
our initiatives are working,” search.
said Executive Chairman Revenue for the New Al-
Arthur Martinez. bany, Ohio, company to-
The shift in strategy can taled $878.6 million, also
be seen in the company’s handily beating analyst
quarterly adjusted gross expectations for $869 mil-
profit rate, which was 63.7 lion.
percent. That’s an im- “Customers responded fa-
provement of 120 basis vorably to the company’s
points, and 210 basis points recent floorsets despite re-
on a constant currency duced promotions,” wrote
American homebuilder sentiment slips in November
ALEX VEIGA Readings above 50 indi- pullback from October’s over the past three years 468,000, the slowest pace
AP Business Writer cate more builders view reading, which hit the high- has improved many family in 10 months. The decline
U.S. homebuilders are feel- sales conditions as good, est level in 10 years, and is balance sheets, while rising snapped a two-month
ing slightly less confident in rather than poor. The in- more in line with the con- home prices has returned streak of accelerating
their sales prospects head- dex has been consistently sistent, modest growth in equity to current hom- sales.
ing into next year, even as above 50 since July last new home sales seen this eowners now seeking to Sales of new homes remain
their overall sales outlook year. year, said David Crowe, upgrade to new residen- below the 52-year historic
remains favorable. Builders’ view of current the NAHB’s chief econo- tial developments. Sales of average of 655,200.
The National Association of sales conditions and their mist. “A firming economy, new homes have soared This month’s builder index
Home Builders/Wells Fargo outlook for sales over the continued job creation 17.6 percent during the first was based on 364 respon-
builder sentiment index re- next six months also de- and affordable mortgage nine months of 2015. dents.
leased last week slipped clined. A measure of traf- rates should keep housing Still, new-home sales Builders’ view of current
this month to 62, down fic by prospective buy- on an upward trajectory plunged sharply in Sep- sales conditions for single-
three points from a revised ers rose slightly. The latest as we approach 2016,” tember to a seasonally family homes fell three
reading of 65 in October. builder index represents a Crowe said. Solid hiring adjusted annual rate of points to 67.q
