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Bristol-Myers To Acquire Celgene; To Be Above 40% EPS Accretive In First Year

Bristol-Myers Squibb Company (BMY) and Celgene Corp. (CELG) announced a definitive merger agreement under which Bristol-Myers Squibb will acquire Celgene in a cash and stock transaction with an equity value of approximately $74 billion. Celgene shareholders will receive 1.0 Bristol-Myers Squibb share and $50.00 in cash for each share of Celgene. Celgene shareholders will also receive one tradeable Contingent Value Right for each share of Celgene, which will entitle the holder to receive a payment for the achievement of future regulatory milestones. When completed, Bristol-Myers Squibb shareholders are expected to own approximately 69 percent of the company, and Celgene shareholders are expected to own approximately 31 percent. The combined company will have nine products with more than $1 billion in annual sales.

Bristol-Myers Squibb expects to realize run-rate cost synergies of approximately $2.5 billion by 2022. The combination is expected to be more than 40 percent accretive to Bristol-Myers Squibb's EPS on a standalone basis in the first full year following close of the transaction.

Separately, Bristol-Myers Squibb announced EPS guidance for full-year 2019. The company expects GAAP EPS in a range of $3.75 to $3.85 and non-GAAP EPS guidance in a range of $4.10 to $4.20. The company noted that the EPS guidance excludes the impact of the Celgene acquisition or any potential future strategic acquisitions and divestitures.

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