Perrigo Plunges On $1.9B Tax Bill From Irish Government
Zacks Investment Research | Dec 23, 2018 10:04PM ET
Perrigo Company plc (NYSE:PRGO) announced that the Irish Office of the Revenue Commissioners has issued a Notice of Amended Assessment for a tax liability of $1.9 billion (€1.636 billion) related to Elan Pharma, the entity which Perrigo acquired in 2013.
Shares of the company plunged almost 30% on Dec 21, following the news of such huge tax liability. Perrigo’s shares are down 57.5% so far this year compared with the industry ’s decline of 9.2%.
The company is planning to file an appeal with the Irish revenue department. Perrigo strongly disagrees with the assessment and stated that no payment is required until all proceedings are complete. The proceedings are expected to take a few years to complete.
The notice from the Irish government stated that Elan Pharma is liable to pay the said tax amount related to the sale of Tysabri intellectual property and related assets to Biogen (NASDAQ:BIIB) in 2013. Elan was eligible to receive an upfront payment and future contingent payments from Biogen, which were recognized as trading income attracting a taxrate of 12.5%.
However, the Irish revenue department stated in the notice that the sale related to Tysabri should be considered as chargeable gains subject to ahigher tax rate of 33%. This led to a massive tax bill for Perrigo.
Perrigo has asked the Irish revenue department for clarification and additional documents in support of the bill. However, the authority has communicated to Perrigo thatno further information will be provided related to this tax bill and the latter should file an appeal by Dec 28, 2018.
Perrigo Company plc Price
Zacks Investment Research
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.