Bristol-Myers Squibb agrees $5.3bn deal to acquire Amylin

US pharmaceutical group Bristol-Myers Squibb Co (NYSE:BMY) said it had made an agreement to buy diabetes-focused biopharmaceutical firm Amylin Pharmaceuticals Inc (NASDAQ:AMLN) at U$31.00 (€24.50) in cash per share, or $5.3bn in total, plus assumption of around $1.7bn of debt.

With this move, Bristol-Myers Squibb will add innovative diabetes products, talent and state-of-the art manufacturing facility to its portfolio, in a move to boost its top position in metabolics, CEO Lamberto Andreotti said. The deal also allows Bristol-Myers Squibb to widen its alliance with British biopharmaceutical company AstraZeneca Plc (LON:AZN) through an accord regarding the development and commercialisation of Amylin’s portfolio of products.

The collaboration arrangement with AstraZeneca, backed by the boards of both parties, calls for the British group to pay some $3.4bn in cash to Amylin as a fully-owned unit of Bristol-Myers Squibb, with profits and losses to be equally shared.

This payment will be made following the completion of Bristol-Myers Squibb’s acquisition of Amylin.

Amylin’s board approved the takeover by Bristol-Myers Squibb and advised shareholders to tender their stock to the 30-day offer, which is subject to securing at least a majority of the target’s shares as well as the Hart-Scott-Rodino (HSR) clearance. The tender bid will be followed by a short-term merger.

Bristol-Myers Squibb said it would use existing cash and debt to finance the purchase.

In a comment, Amylin’s CEO and president Daniel M. Bradbury said that the deal with Bristol-Myers Squibb and their alliance with AstraZeneca provide an opportunity to maximise the potential and impact of the firm’s diabetes therapies whose global reach will be extended. The agreement follows a several months long strategic review of options by Amylin focused on finding a way to maximise the value of its diabetes franchise, the CEO added.

For its part, AstraZeneca expects the collaboration agreement to immediately contribute to its revenues, as part of a strategy to step up growth and enhance late stage pipeline, interim CEO Simon Lowth said.

Citigroup Inc (NYSE:C), Evercore Partners Inc (NYSE:EVR) and Kirkland & Ellis LLP are advising Bristol-Myers Squibb, while Amylin has engaged the services of Credit Suisse Securities (USA) LLC, Goldman Sachs & Co and Skadden, Arps, Slate, Meagher & Flom LLP.

AstraZeneca’s advisors are Bank of America Merrill Lynch, Davis Polk & Wardwell LLP and Covington & Burling LLP.