Sector News

Bristol issues $19B in bonds to help fund Celgene buy

May 9, 2019
Life sciences

Bristol-Myers Squibb is taking on a debt load to cover its $74 billion Celgene buyout, and it issued $19 billion in bonds Tuesday to help pay the bill.

Bristol-Myers issued bonds in nine tranches that come due starting next year and stretch all the way out into 2049. In all, Bristol wants to take on $32 billion in new debt itself, plus $20 billion in Celgene debt, to fund the deal, the drugmaker said in a presentation (PDF) outlining the proposed merger.

But BMS doesn’t plan to carry that burden for long. Company executives have said they’re planning to quickly put their money to work paying down that load. The combined company would have $45 billion in free cash flow in the first three years after closing, BMS has said.

“Our priorities for capital deployment moving forward include rapidly paying down debt over the next few years, improving our credit metrics, and we expect to continue to increase our dividend,” Bristol CEO Giovanni Caforio said on the company’s first-quarter conference call.

Bristol announced the massive Celgene buy back in early January. In touting the deal, executives said the combined company would be the top player in oncology and cardiovascular diseases, plus a top 5 company in immunology and inflammation. It’d have nine products with more than $1 billion in annual sales plus six near-term launches.

The deal faced activist investor pushback in the months that followed, but investors signed off on the acquisition in April.

It’s far from the first time a pharma company has issued billions of dollars worth of bonds to finance an acquisition. Roche in 2009 issued $16 billion in bonds to fund its Genentech buy. More recently, Teva Pharmaceutical issued $20 billion worth of bonds to buy Allergan’s generics unit.

Bristol’s bond deal is the largest in any industry so far this year and 10th-largest of all time, Bloomberg reports.

By Eric Sagonowsky

Source: Fierce Pharma

comments closed

Related News

June 24, 2022

Echosens and Novo Nordisk announce partnership to increase awareness and advance early diagnosis of NASH

Life sciences

Echosens, a high-technology company offering liver diagnostic solutions, and Novo Nordisk A/S, a leading global healthcare company, announced a partnership to advance early diagnosis of non-alcoholic steatohepatitis (NASH) and increase awareness of the disease among patients, healthcare providers and other stakeholders.

June 24, 2022

argenx receives positive CHMP opinion for Efgartigimod for the treatment of adult patients with Generalized Myasthenia Gravis in Europe

Life sciences

Positive opinion based on Phase 3 ADAPT trial showing efgartigimod provided clinically meaningful improvements in strength and quality of life measures. If approved, efgartigimod will be the first neonatal Fc receptor (FcRn) blocker for the treatment of adults in Europe living with rare neuromuscular disease generalized myasthenia gravis (gMG).

June 24, 2022

Galapagos finally takes M&A plunge, spending $251M for 2 biotechs in CAR-T push

Life sciences

Galapagos CEO Paul Stoffels, M.D., has finally taken the plunge on M&A. The newly minted chief executive has signed not one but two deals in an attempt to right the ship, bringing two small biotechs aboard for a combined 239 million euros ($251.4 million).