Summary
Bristol-Myers Squibb Company (BMY) announced on May 7, 2019, the pricing of a significant debt offering totaling approximately $17.25 billion. This offering includes various tranches of floating rate notes and fixed-rate notes with maturities ranging from 2020 to 2049. The primary purpose of this debt issuance is to fund a portion of the cash consideration required for the previously announced acquisition of Celgene Corporation, a major strategic move for BMY. Investors should note that the debt offering is not contingent on the completion of the Celgene merger. However, if the merger does not close by July 30, 2020, or if BMY decides not to proceed with the merger, the company is obligated to redeem all outstanding notes at a premium (101% of principal plus accrued interest). This provides a degree of protection for bondholders in the event the merger is unsuccessful, while also highlighting the critical nature of the Celgene acquisition to BMY's financing strategy.
Key Highlights
- 1BMY priced a substantial debt offering totaling $17.25 billion across multiple note issuances with varying maturities.
- 2The debt offering is intended to finance a portion of the cash consideration for the pending acquisition of Celgene Corporation.
- 3The Notes offering is independent of the Celgene merger's consummation, meaning the debt must be issued regardless of the merger's outcome.
- 4A mandatory redemption clause is in place: if the Celgene merger is not completed by July 30, 2020, BMY must redeem all notes at 101% of face value plus accrued interest.
- 5The debt issuance signals BMY's commitment to funding the Celgene acquisition through debt financing.
- 6The offering includes both floating rate notes and fixed-rate notes, diversifying the company's debt structure.
- 7BMY has filed the Purchase Agreement and a press release announcing the pricing of the notes as exhibits to the 8-K.