Pfizer (NYSE: PFE) announced on Monday morning that its subsidiary, Upjohn will merge with Mylan (NASDAQ: MYL). Following the news, Mylan shares rose by 13% during Monday’s pre-market hours.

Under the all-stock agreement, each Mylan share would be converted into one share of the new Company. Pfizer shareholders would own 57% of the combined company, and Mylan shareholders would own 43%. 

Pfizer said that the new Company will transform and accelerate each businesses’ ability to serve patients’ and expand their capabilities across more than 165 markets. Mylan’s diverse portfolio of key therapeutics such as central nervous systems and anesthesia, infectious diseases, and cardiovascular pipeline will merge with Upjohn’s portfolio of Lipitor (atorvastatin calcium), Celebrex (celecoxib), and Viagra (sildenafil). 

The merged company will also drive a sustainable, diverse, and differentiated portfolio of prescription medicines, complex generics, over-the-counter products and biosimilars, established infrastructure, best-in class R&D capabilities, and high-quality manufacturing and supply chain excellence. 

Dr. Albert Bourla, Pfizer Chief Executive Officer, stated, “We are creating a new champion for global health—one poised to bring world-class medicines to patients across a wide range of therapeutic areas. I believe that Mylan’s unique profile and strategy has made it the obvious partner of choice in creating this powerful combination. By bringing Mylan’s growth assets to Upjohn’s growth markets, we will create a financially strong company with true global reach. I’m also excited about the management team, which combines strong executive talent from both companies, whose commitment to improving global health for patients and to delivering returns to shareholders are great assets for the new company. For Pfizer, this transaction represents our sharpened focus on innovative medicines and is a testament to our purpose – breakthroughs that change patients’ lives. At the same time, we’ll maintain the financial flexibility to advance our strong pipeline, invest for growth and continue to return capital to our shareholders.”

The new company, which its name will be disclosed and rebranded at the closing of the transaction, will be led by Mylan’s current Chairman Robert Coury, who will serve as the Executive Chairman of the new Company. Upjohn’s current Group President will serve as the Chief Executive Officer.

The combined company is expected to have pro forma 2020 revenues of USD 19 Billion to USD 20 Billion. Pro forma adjusted EBITDA is projected to be in the range between USD 7.5 Billion and USD 8 Billion.