NEW YORK (TheStreet) -- Baxalta (BXLT) stock is surging by 6.08% to $40.84 on heavy trading volume this afternoon, after Shire (SHPG) announced that it anticipates the companies' pending merger will proceed as originally planned.
Shire reiterated that it expects the merger to be completed by mid-2016.
Shire stock is soaring by 3.32% to $179.23 in late-afternoon trading.
Shares of both biopharmaceutical companies tumbled yesterday after the Treasury Department proposed new regulations that would make tax inversions less financially appealing. Under such a deal, a U.S.-based company merges with a foreign company and moves its headquarters abroad to receive a lower tax rate.
Dublin-based Shire's proposed takeover of its U.S. rival was not structured as an inversion, but the impact of the new regulations "will take us some time to digest," Shire said yesterday, according to the Financial Times.
About 41.24 million shares of Baxalta have been traded so far today, well above the company's average trading volume of roughly 9.53 million shares per day.