October 15, 2009 / 5:11 PM / in 8 years

UPDATE 1-Pfizer completes $67 bln deal for rival Wyeth

* Wyeth to cease trading as of Thursday market close

* To begin jointly operating on Friday

NEW YORK, Oct 15 (Reuters) - Pfizer Inc (PFE.N) completed its roughly $67 billion acquisition of U.S. rival Wyeth WYE.N on Thursday, as the world’s largest drugmaker gets even bigger.

Wyeth shares were set to cease trading as of the close of trading on Thursday, and the companies were due to begin operating jointly on Friday, Pfizer said in a statement.

After U.S. and Canadian antitrust regulators cleared the deal on Wednesday, Pfizer said it has received approval from all government authorities required by the merger agreement.

In buying Wyeth, Pfizer hopes to soften the blow when it loses U.S. patent protection for its $11 billion-a-year cholesterol medicine Lipitor by adding Wyeth’s lucrative vaccines and injectable biologic medicines. The combined companies’ revenue totaled $71.1 billion last year.

The Wyeth deal marks the third giant acquisition for Pfizer in the last nine years. It bought Warner-Lambert for $114 billion in 2000, gaining full ownership of Lipitor, and acquired Pharmacia in 2003 for $60 billion.

Pfizer has said it plans to cut 15 percent of the combined company’s workforce of about 130,000 employees and close some manufacturing sites. As with the past deals, that would provide huge cost savings that will support earnings for a while.

To complete the Wyeth deal, Pfizer halved its dividend, angering many investors. However, some analysts believe Pfizer may boost the payout now that the deal has closed.

A Credit Suisse survey of more than 100 investors found that nearly two-thirds expect a dividend increase of 11 percent to 25 percent.

Under the terms of the transaction, each share of Wyeth is being converted into the right to receive $33 in cash and 0.985 of a share of Pfizer.

Based on Wednesday’s closing prices, the deal is valued at about $66.9 billion. The deal was valued at $68 billion when it was originally announced in January.

Shares of Wyeth were up 5 cents at $50.09 in afternoon trading on the New York Stock Exchange. Pfizer shares up 1 cent at $17.38. (Reporting by Lewis Krauskopf; Editing by Tim Dobbyn)

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