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Pfizer to raise $31 billion for Seagen takeover in largest debt offering

Published 05/16/2023, 07:29 PM
Updated 05/17/2023, 02:11 PM
© Reuters. FILE PHOTO: Pfizer logo is seen in this illustration taken, May 1, 2022. REUTERS/Dado Ruvic/Illustration

(Reuters) -Pfizer Inc is planning to raise $31 billion through its largest debt offering to finance its proposed acquisition of Seagen Inc, the drugmaker said late on Tuesday.

The company struck a $43 billion deal in March to acquire Seagen and its targeted cancer therapies as it prepares for a steep fall in COVID-19 sales and generic competition for some top-selling drugs.

Rival Abbvie Inc had in 2019 made a $30 billion debt offering, which was used to finance its $63 billion buyout of Botox maker Allergan (NYSE:AGN). The amount is more than double that of Pfizer (NYSE:PFE)'s 2009 debt raise of $13.5 billion.

Pfizer has been pumping billions of dollars into research and acquisitions to mitigate an anticipated $17-billion hit to revenue by 2030 from patent expirations for top drugs and a decline in demand for COVID products.

The debt offering, which would be in eight tranches, is expected to close on May 19. Yield to maturity on Pfizer's 10-year bonds would be 125 basis points higher than the benchmark risk-free U.S. 10-year Treasury. 

BofA Securities, Citigroup (NYSE:C), Goldman Sachs (NYSE:GS) and J.P. Morgan are the joint lead managers and joint book-running managers for the offering.

Latest comments

Big pharma gets bigger. It's transparent corruption with key members of both surface parties.
Pfizer stock is slipping down inspite of strong financial situation
@sayed, my comment is not about share price but influence over big pharma and governments putting profits (and votes) over people's actual health. And this is not a partisan problem.
Key leaders of FDA and NIH get fat jobs after they leave public service in exchange for favors when they are in public service. This practice needs to be regulated ideally.
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