Eli Lilly to acquire ImClone for $6.5 billion

John C. Lechleiter, President and Chief Executive Officer Eli Lilly today said it is acquiring biotechnology company ImClone Systems, for about $6.5 billion, beating the revised offer by Bristol Myers.

The bid by Eli Lilly confirms earlier reports that it was the mystery company that Carl Icahan, chairman, ImClone, had said had rivalled the bid by Bristol Myers (See: Mystery buyer Eli Lilly reported to outbid Bristol-Myers with $6.1 billion for ImClone

Eli Lilly's offer, worth $70 a share values the biotech company at 6.5 billion, beating the sweetened $62 a share or $4.7 billion that Bristol-Myers Squibb had offered, threatening to go directly to the shareholders with a hostile bid.

Beristol Myers jointly markets ImClone's cancer drug Erbitux in the US and owns 17 per cent had ofered to acquire the remaining shares of ImClone for $4.3 billion at  $60 per share on 31 July, which the biotech firm turned down 10 days later (See: ImClone rejects Bristol-Myers Squibb's $4.3 billion bid; cites $6.1 billion fresh offer).

Eli Lilly and and ImClone Systems today said that the boards of directors of both companies had approved a definitive merger agreement under which Lilly would acquire ImClone through an all-cash offer, which represents a premium of 51 per cent to ImClone's closing stock price on July 30, 2008, the day before Bristol Mysers fiorst unveiled its acquisition offer.

ImClone's board has recommended eli Lilly's offer and Icahn, who holds approximately 14 per cent of ImClone's outstanding common stock through some entities, would tender the shares in the Eli Lilly offer.

Lilly said in a statement that its strategic combination with ImClone would create one of the leading oncology franchises in the biopharmaceutical industry, offering both targeted therapies and oncolytic agents along with a pipeline spanning all phases of clinical development.