Biotech Values

[DewDiligence]

Addendum re BMY-MJN stock swap: In addition to the three bulleted reasons in #msg-44176162, a fourth albeit minor reason to not tender is that MJN effectively can’t be acquired by a third party during the six months following the BMY stock swap. If such a sale of MJN were consummated, the IRS could interpret the BMY-MJN stock swap as a sham transaction whose real purpose was to enable BMY to sell MJN without incurring a capital-gains tax. The consequence of such an interpretation would be the IRS’ revoking the tax-free status of the stock swap, which would be a very bad outcome for all parties (except, of course the IRS).

This additional point does not affect my decision on the stock swap to a material degree, but I thought it was worth mentioning for the sake of completeness.