Bristol-Myers Squibb to Buy Amylin for $7B

by Christopher Freeburn | July 2, 2012 9:24 am

Bristol-Myers Squibb to Buy Amylin for $7B

Bristol-Myers Squibb (NYSE:BMY[1]) announced plans to purchase[2] Amylin Pharmaceuticals (NASDAQ:AMLN[3])  for $7 billion on Friday.

The announcement sent Amylin shares up more than 8%, while shares of Bristol-Myers Squibb slipped fractionally in pre-market trading on Monday.

Under the terms of the announced deal, Bristol-Myers Squibb will pay $31 a share for the diabetes drug developer, the Associated Press noted.

The deal features a $5.3 billion cash payment, with the remaining $1.7 billion comprising Bristol Myers-Squibb’s absorption of Amylin’s debt and compensation paid to Eli Lily & Company (NYSE:LLY[4]), which had marketed Amylin drugs under an agreement that expired last fall.

Amylin produces the diabetes treatment drugs Byetta and Bydureon.

AztraZeneca (NYSE:AZN[5]) will collaborate on the development and marketing of Amylin’s drugs and will pay Bristol-Myers Squibb $3.4 billion in cash for the partnership.

Amylin’s management was pressured to seek the sale of the company[6] by billionaire investor Carl Icahn, who controls about 10% of its shares, Reuters noted. Icahn, who waged a four-year campaign to force the firm into a sale, will make a roughly $80 million profit on the deal.

Endnotes:
  1. BMY: http://studio-5.financialcontent.com/investplace/quote?Symbol=BMY
  2. announced plans to purchase: http://www.businessweek.com/ap/2012-07-02/ahead-of-the-bell-amylin-pharma-shares-climb
  3. AMLN: http://studio-5.financialcontent.com/investplace/quote?Symbol=AMLN
  4. LLY: http://studio-5.financialcontent.com/investplace/quote?Symbol=LLY
  5. AZN: http://studio-5.financialcontent.com/investplace/quote?Symbol=AZN
  6. was pressured to seek the sale of the company: http://www.reuters.com/article/2012/07/02/us-icahn-amylin-idUSBRE86105N20120702

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