[News] Pfizer to buy Wyeth for $68 billion
http://money.cnn.com/2009/01/26/news/companies/pfizer_wyeth/?postversion=2009012614
Cash-and-stock deal will keep Pfizer the No. 1 drugmaker. Company
announces sharp drop in profit, and will cut tens of thousands of
jobs.
By Aaron Smith, CNNMoney.com staff writer
Last Updated: January 26, 2009: 2:56 PM ET
NEW YORK (CNNMoney.com) -- Pfizer announced Monday that it has
signed a deal to acquire the smaller drugmaker Wyeth for $68
billion, and tens of thousands of job cuts will follow.
New York-based Pfizer, already the world's leading drugmaker,
becomes even larger following the cash-and-stock deal with Wyeth,
based in Madison, N.J.
The deal values Wyeth shares at $50.19 each, a nearly 15% premium
to Friday's closing price. Pfizer agreed to pay $33 in cash and
0.985 share in Pfizer stock for each Wyeth share.
Pfizer spokesman Ray Kerins said that two waves of job cuts would
occur in 2009. In the first, Pfizer said it would cut 10% of its
81,900 staff - about 8,000 jobs.
Kerins said that Pfizer will launch the second round of job cuts
once its merger with Wyeth and its 50,000 workers is completed in
the third or fourth quarter. At that time, Kerins said Pfizer will
cut 15% of the combined company's 120,000 or so workers - about
18,000 more job cuts.
In all, Pfizer is planning about 26,000 new job cuts and will
close five manufacturing plants.
"We're going to do everything we can to improve on our revenues
and maximize our performance," said Pfizer Chief Executive Jeffrey
Kindler, in a Monday press conference.
Pfizer recently announced that it was cutting up to 8% of its
research staff, or up to 800 jobs.
Pfizer said the deal would be financed through a combination of
cash, debt and stock. The company said it is borrowing $22.5
billion from a consortium of banks.
The board of directors also decided to cut Pfizer's quarterly
dividend in half to 16 cents a share.
Pfizer announced that it would ramp up its focus in treatments for
Alzheimer's disease, inflammation, cancer, pain and psychosis, and
continue to focus on vaccines and biotechnology.
"We want to become a leader in biotherapeutics and vaccines," said
Kindler. "There is no other company that is such a perfect fit for
those strategies."
Pfizer also reported a 90% plunge in quarterly net profit. The
company said its diluted earnings per share plummeted to 4 cents
in the fourth quarter, from 40 cents the prior year.
The company blamed a $2.3 billion charge to resolve allegations
from federal prosecutors that it had promoted Bextra for uses not
approved by the FDA. Bextra, an anti-arthritis drug, was pulled
off the market after Merck's (MRK, Fortune 500) Vioxx was
withdrawn in 2005.
Pfizer also reported a slight decline in fourth-quarter revenue to
more than $12.3 billion, from nearly $12.9 billion the year
before.
This is the first big merger since 2006, when the telecom giant
AT&T (ATT) merged with BellSouth for $67 billion. After that deal,
AT&T cut 10,000 jobs.
Miller Tabak analyst Les Funtleyder, author of "Healthcare
Investing," said that Wyeth has a "decent pipeline" but with
"nothing that immediately jumps out at me as blockbuster." Most
promising, he said, is Wyeth's plan to roll out a new form of
Prevnar, which combats meningitis and blood infections, with sales
totaling $2.1 billion in 2008.
Daniel Ruppar, pharma and biotech analyst for Frost & Sullivan,
said that Pfizer "needed to do some major purchase to expand their
portfolio, because they have been doing a lot of cuts and trying
to realign themselves. They may use this opportunity to take the
best that they have, as well as try to pick the best from within
the science structure at Wyeth."
Pfizer's (PFE, Fortune 500) stock price fell 10% in midday
trading, while Wyeth's (WYE, Fortune 500) was little changed.
One of Pfizer's chief challenges is finding a replacement for the
cholesterol-cutting Lipitor, the top-selling drug of all time. The
drug's annual sales peaked at nearly $13 billion in 2006, but
revenue will plummet when Lipitor's patent expires in 2011.
--
※ 發信站: 批踢踢實業坊(ptt.cc)
◆ From: 118.166.4.132
推
02/02 09:34, , 1F
02/02 09:34, 1F