Merger Watch: ImClone Systems - Bristol Myers Squibb

The proposed ImClone Systems (IMCL) - Bristol Myers Squibb (BMY) merger remains somewhat of an enigma a month after the initial assessment. There are no substantial developments of note related to BMY's current offer, from either side, although there have been several scattered analytical pieces focusing on IMCL's "Erbitux" product use expansion as a catalyst for an increased offer. However, this is no revelation, as IMCL's pipeline products -- particularly "IMC-11F8" -- are the obvious rationale for BNY, or any party interested in IMCL.

This is increasingly looking to become yet another attrition situation, where both sides become entrenched in their respective positions with respect to the buyout offer. Clearly, IMCL, led by Carl Icahn, will not seriously consider the $60 per share offer at any point in the near future. Under the current and foreseeable future circumstances, nothing less than a $70 per share offer will be necessary simply to draw IMCL into negotiations. As BMY does not seem inclined to increase its offer to that level at this time, the stalemate could very easily continue for several months without any real developments.

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Comments

[nova:]

Just fine with me.

Positive PhIII results from any of ImClone's four pipeline candidates will propel the stock to over $100.

2008 Sep 08 06:08 PM