AbbVie Inc. has agreed to acquire Allergan plc, bringing together two of the world’s largest pharmaceutical companies in a deal valued at $63 billion.

The deal is expected to close in early 2020. AbbVie plans to continue to be incorporated in Delaware as AbbVie Inc., have its principal executive offices in North Chicago and be led by Richard A. Gonzalez as chairman and CEO. Two members of Allergan's board, including CEO Brent Saunders, are expected to join AbbVie's board once the deal closes. Allergan is based in Dublin, Ireland.

"This is a transformational transaction for both companies and achieves unique and complementary strategic objectives," Gonzalez said in a statement. "The combination of AbbVie and Allergan increases our ability to continue to deliver on our mission to patients and shareholders. With our enhanced growth platform to fuel industry-leading growth, this strategy allows us to diversify AbbVie's business while sustaining our focus on innovative science and the advancement of our industry-leading pipeline well into the future."

The acquisition creates compelling value for Allergan's stakeholders, including customers, patients and shareholders, Allergan's Saunders added.

“With 2019 annual combined revenue of approximately $48 billion, scale in more than 175 countries, an industry-leading R&D pipeline and robust cash flows, our combined company will have the opportunity to make even bigger contributions to global health than either can alone," Saunders said. "Our fast-growing therapeutic areas, including our world-class medical aesthetics, eye care, CNS and gastrointestinal businesses, will enhance AbbVie's strong growth platform and create substantial value for shareholders of both companies."

The agreement calls for Allergan shareholders to receive 0.8660 AbbVie Shares and $120.30 in cash for each Allergan share, for a total consideration of $188.24 per Allergan Share. The transaction represents a 45% premium to the closing price of Allergan's shares on June 24.

AbbVie anticipates that the acquisition will provide annual pre-tax synergies and other cost reductions of at least $2 billion in year three while leaving investments in key growth franchises untouched.

It is expected that, immediately after the closing of the acquisition, AbbVie shareholders will own approximately 83% of AbbVie on a fully diluted basis and the Allergan shareholders will own approximately 17% of AbbVie on a fully diluted basis. The transaction is subject to the conditions set out in Appendix III of the Rule 2.5 announcement, including certain regulatory approvals and approval by Allergan's shareholders.