Pfizer to acquire Wyeth for $68bn
4 February 2009
Pfizer (NYSE: PFE) and Wyeth (NYSE: WYE) have entered into a
definitive merger agreement under which Pfizer will acquire Wyeth in a
cash-and-stock transaction currently valued at $50.19 per share, or a
total of approximately $68 billion. The Boards of Directors of both
companies have approved the combination.
The combined company will create one of the most diversified
companies in the global health care industry. The combined company will
have product offerings in numerous growing therapeutic areas, a strong
product pipeline, leading scientific and manufacturing capabilities, and
a premier global footprint in healthcare.
The companies say that a broad and diversified global product
portfolio and reduced dependence on small molecules, the new company
will be positioned for improved, consistent, and stable top-line and EPS
growth and sustainable shareholder value in the short and long term. It
is expected that no drug will account for more than 10% of the combined
company’s revenue in 2012.
The transaction will be financed through a combination of cash, debt
and stock. A consortium of banks has provided commitments for a total of
$22.5 billion in debt.
Jeffrey B. Kindler, Chairman and Chief Executive Officer of Pfizer,
said: “The combination of Pfizer and Wyeth provides a powerful
opportunity to transform our industry. It will produce the world’s
premier biopharmaceutical company whose distinct blend of
diversification, flexibility, and scale positions it for success in a
dynamic global health care environment. The new company will be an
industry leader in human, animal and consumer health. With our combined
biopharmaceuticals business, it will lead in primary and specialty care
as well as in small and large molecules. Its geographic presence in most
of the world’s developed and developing countries will be unrivaled.”
Bernard Poussot, Chairman, President and Chief Executive Officer of
Wyeth, said, “Wyeth’s commitment to scientific innovation has enabled us
to build a diversified biopharmaceutical company with leadership in
attractive growth areas such as vaccines, nutritionals and biologics.
For example, Wyeth developed Prevnar, the first pneumococcal vaccine for
infants.
“In addition, because we were early to see the potential of
biotechnology to create life-changing medicines, we now have a strong
franchise which includes Enbrel, the number one biotechnology product in
the world. With our business focused on prevention and wellness, Wyeth
is well positioned in today’s rapidly changing health care environment.
“Our employees should be enormously proud of what we have built and
confident that combining with Pfizer will accelerate our pursuit of
innovative new medicines to meet critical unmet patient needs. Wyeth and
Pfizer are highly complementary businesses, and together we can build
the best diversified health care company in the world. We believe we can
better execute our strategy and can accomplish far more together in the
years ahead than either company could have achieved on its own.”
Mr. Kindler continued, “With this combination, Pfizer will offer
patients around the world a uniquely broad and diversified portfolio of
biopharmaceutical innovations through business units--each one focused
on different customer needs and backed by the resources of a premier
global organization. By combining the spirit of small, agile enterprises
with our combined scale, Pfizer will advance its mission of working
together toward a healthier world.”
Mr. Kindler added, “Over the last several years, Wyeth’s leadership
and its employees have done an outstanding job creating a strong,
diversified biopharmaceutical company. The people, products, and
technologies that Wyeth brings to the new company will enhance our
scientific capabilities and drive further commercial innovation to
improve the health of the patients we serve. The compelling combination
of Pfizer and Wyeth allows us to advance our newly strengthened
organization to the next level by harnessing the talents of the best
people from both companies. This will enable us to accelerate
significantly our progress along ‘Our Path Forward’ as we pursue our
mission of applying innovative science to improve world health.”
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