Like a potential bride who just can't find a partner willing to settle down,
American Home Products
watched Sunday as its would-be partner
planned to merge instead with
Pfizer is expected to announce its acquisition of Warner-Lambert on Monday, unnamed sources told
Saturday. The deal has been valued at between $84 billion and $87 billion and will create America's largest drug maker.
American Home, which previously had failed to merge with
, has agreed to walk away from Warner-Lambert in exchange for $1.8 billion, sources told
The New York Times
over the weekend.
The breakup fee was specified in the company's initial agreement to merge with Warner-Lambert. Shortly after the two agreed to join in November, Pfizer upstaged American Home with an unsolicited counteroffer of $82 billion.
At first, Warner-Lambert refused to consider Pfizer's bid, but finally caved in last month.
Shares of Warner-Lambert closed Friday up 1 1/16, at 94 9/16, and Pfizer finished up 1/8, at 35 3/4. American Home fell 2 3/16 to finish at 45 1/2.
Representatives from the three companies could not be reached for comment Sunday.
David Rheingold is a New York-based freelance writer. At the time of publication he had no positions in any of the securities mentioned, although holdings can change at any time.