BMS Buyout of Celgene for $74 Billion Save

Reuters reports that Bristol-Myers Squibb (BMS) has announced its intention to buy Celgene Corp for nearly $74 billion in a cash-and-stock deal.

Celgene shareholders will receive one BMS share and $50 in cash per share (or $102.43 per share), and a premium of 53.7 percent to Celgene’s Wednesday close.

Celgene and BMS will have to pay $2.2 billion if either of the drugmakers walks away from their $74 billion merger according to a regulatory filing.

BMS shareholders are expected to own nearly 69% of the merged company, with Celgene shareholders owning the remaining 31%.

As part of the transaction, BMS will gain rights to Celgene's cancer therapy Revlimid (lenalidomide), as well as its CAR-T portfolio, which it acquired via its $9-billion takeover of Juno Therapeutics last year.

The combined company will have nine products with more than $1 billion in annual sales. Together, the company will have an oncology pipeline for solid and hematologic tumors led by blockbuster treatments Opdivo, Revlimid, Pomylyst and Yervoy. Its cardiovascular pipeline will be led by Eliquis and the immunology and inflammation franchise will be led by Orencia and Otezla.

The deal, which is worth $95 billion including Celgene’s debt, is the largest pharmaceutical deal ever and brings together two of the world’s largest cancer drug businesses.