ImClone Systems for $70/sh from Eli Lilly
Target: ImClone Systems (IMCL)
Deal: $70/share
Current Share Price (10/10/2008): $65
Acquirer: Eli Lilly and Co.
Notes:
The $70/sh offer beat out another offer of $62/sh from Bristol-Myers Squibb.
Current arbitrage spread: $5/sh
Seems like a consensus is growing that this deal might not happen.
But the deal immediately raised eyebrows when Lilly executives revealed that as much as half the cash will be raised through debt… -TheDeal.com
Pretty good profit potential– however, that is certainly due to lingering doubts about the deal. Using debt to finance much of the deal (see quote above), when credit markets are the way they are right now, might not be something that is feasible. We’ll need to keep watching this one.
My M&A Status on this one: WATCH
Sources:
“No love for Lilly” (TheDeal.com)
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