Amylin, Bristol-Myers in $5.3 Billion Deal, Record Jobless Rate in Europe

Arthi Gupta
02 Jul, 2012
New York City

U.S. indexes traded sideways after weak global economic data. Bristol-Myers agreed to acquire Amylin for $5.3 billion, Micron Technology agreed to buy Japanese chipmaker Elpida for $2.5 billion and Ingram Micro agreed to purchase Brightpoint for $840 million.

[R]9:10 AM New York – U.S. indexes traded sideways after weak global economic data. Bristol-Myers agreed to acquire Amylin for $5.3 billion, Micron Technology agreed to buy Japanese chipmaker Elpida for $2.5 billion and Ingram Micro agreed to purchase Brightpoint for $840 million.[/R]

U.S. indexes were cautious on the first day of trading after latest economic data from Europe and China were in focus.

European markets extended Friday’s gains on the optimism after regional leaders took emergency steps and offered direct lending to banks easing stress in the sovereign bond markets of Spain and Italy.

However, analysts are cautious and investors are looking for details of the new bank lending rules and the plans for the launch of regional banking authority and weak economic data in the region.

The unemployment rate in May increased to 11.1% from 11% in April, record high since the launch of euro in 1999 according to the latest data released by the eurostat.

In addition, a private survey showed a decline in manufacturing index for the eleventh month in a row in June and the decline accelerated at the fastest pace in the last thirty month.

French economic growth is estimated to weaken in 2012 and 2013. Separately, the French national auditor said today that the country may need to cut €6 billion in spending in 2012 and cut and raise taxes of €33 billion to meet the deficit target of 4% set by the European Union.

Asian markets edged higher tracking the European and U.S. indexes.

The purchasing managers'' index for the Chinese manufacturing sector fell to a 7-month low of 50.2 in June from 50.4 in May, according to a report released by the China Federation of Logistics and Purchasing and the National Bureau of Statistics.

India''s manufacturing sector grew in June, results of a survey showed. The seasonally adjusted HSBC Purchasing Managers'' Index rose to 55.0 in June from 54.8 in May.

Bristol-Myers Acquires Amylin

Bristol-Myers Squibb will acquire diabetic drug maker Amylin for $31 per share in cash or an aggregate purchase price of approximately $5.3 billion.

The total value of the transaction, including Amylin’s net debt and a contractual payment obligation to Eli Lilly & Company, together totaling about $1.7 billion is approximately $7 billion.

Following the completion of Bristol-Myers Squibb’s acquisition of Amylin, AstraZeneca will make a payment of approximately $3.4 billion in cash and partner with the company to develop and market two diabetic drugs Byetta and Bydureon in international markets.

Linde to Acquire Lincare

Linde AG, the German industrial gases producer agreed to acquire Lincare Holdings, Inc. for $41.50 per share, a 22% premium to the closing price on June 29. The planned acquisition has a total transaction volume of approximately $4.6 billion and is expected to close in third quarter of fiscal 2012.

Ingram Micro to Buy Brightpoint

Ingram Micro Inc., the technology distributor agreed to acquire Brightpoint, Inc., a device lifecycle services provider for $9 per share in cash or about $840 million, including net debt of $190 million on June 30.

The offer price is 66% premium to BrightPoint''s closing stock price on June 29.

Micron Technology Inks Agreement with Elpida

Micron Technology Inc. inked an agreement to acquire Japan-based chipmaker Elpida Memory Inc. for a total consideration of 200 billion yen or $2.5 billion.

Under the deal, Micron will buy Elpida for 60 billion yen or approximately $750 million to be paid in cash. In addition, Micron agreed to pay 140 billion yen or about $1.75 billion in future annual installment payments through 2019 from cash flow generated from Micron''s payment for foundry services provided by Elpida, as a Micron subsidiary.

In a related transaction, Micron also announced today a separate agreement with Powerchip Technology Corporation, a Taiwanese corporation, and certain of its affiliates to acquire the Powerchip group''s 24% share of Rexchip Electronics Corporation for approximately $334 million. Elpida owns about 65% of Rexchip.

Ixia to Purchase BreakingPoint

Ixia agreed to acquire BreakingPoint Systems, Inc. for $160 million in cash, subject to adjustment to net working capital and cash. The transaction is anticipated to close in the third quarter of 2012.