News of an AbbVie-Allergan deal has AGG stock heading higher on Tuesday.

AbbVie (NYSE:ABBV) has announced a new deal that will have it acquiring Allergan (NYSE:AGN) for a total value of $63 billion. The company will be using a mix of cash and stock to acquire all outstanding shares of AGN stock.

The AbbVie-Allergan deal will have the former offering up $120.30 in cash and 0.8660 ABBV shares for each share of AGN stock. This has the company valuing AGN stock at $188.24 per share. This represents a 45% premium over the closing price for AGN stock on Monday.

If the AbbVie-Allergan deal reaches completion, it will leave ABBV shareholders controlling a majority of the company. Holders of ABBV stock will own 83% of the company. The remaining 17% of the company’s stock will belong to holders of AGN stock.

This AbbVie-Allergan deal will also have the two companies seeing synergies as they come together. This includes annual synergies and cost savings of $2 billion starting in the third year after the deal closes.

The AbbVie-Allergan deal will have ABBV continuing to control the company. That means that Richard Gonzalez will continue to serve as its Chairman and CEO. The Board of Directors at the company will gain two new members from AGN’s Board. One of these will be Allergan Chairman and CEO Brent Saunders.

The The AbbVie-Allergan deal will need to complete customary closing conditions before it can reach completion. This will include approval from regulators and shareholders. If all goes well, the deal will close in early 2020.

ABBV stock was down 15% and AGN stock was up 26% as of noon Tuesday.

As of this writing, William White did not hold a position in any of the aforementioned securities.