Bristol-Myers Squibb to use debt financing for Celgene acquisition

By Angela McDaniels

Tacoma, Wash., Jan. 3 – Bristol-Myers Squibb Co. will use debt financing and cash on hand to fund its planned acquisition of Celgene Corp., according to a Bristol-Myers Squibb news release.

Bristol-Myers Squibb said it obtained fully committed debt financing from Morgan Stanley Senior Funding, Inc. and MUFG Bank, Ltd.

The acquisition is not subject to a financing condition.

The company expects that substantially all of the combined company’s debt will be pari passu.

Celgene shareholders will receive one Bristol-Myers Squibb share, $50.00 in cash and one tradeable contingent value right for each share of Celgene. Each contingent value right will entitle the holder to receive a one-time potential payment of $9.00 once future regulatory milestones are reached.

Based on Bristol-Myers Squibb’s Wednesday closing share price, the cash and stock payment is valued at $102.43 per Celgene share, or a roughly 54% premium.

Bristol-Myers Squibb shareholders are expected to own 69% of the combined company, and Celgene shareholders are expected to own about 31%.

The boards of directors of both companies have approved the combination, which is expected to be completed in the third quarter.

Morgan Stanley, Evercore and Dyal Co. LLC are acting as financial advisers to Bristol-Myers Squibb, with Morgan Stanley as lead adviser. J.P. Morgan Securities LLC and Citi are acting as financial advisers to Celgene, with JPMorgan as lead adviser.

Bristol-Myers Squibb and Celgene are biopharmaceutical companies based in New York and Summit, N.J., respectively.

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