Pfizer to raise $31 billion in debt offering to fund Seagen acquisition, SEC filing shows


A brand for Pfizer is displayed on a monitor on the ground on the New York Stock Exchange, July 29, 2019.

Brendan McDermid | Reuters

Pfizer plans to raise $31 billion by means of a debt offering to fund its proposed acquisition of most cancers drugmaker Seagen, for what could be its largest takeover since 2009, in accordance to a brand new filing with the Securities and Exchange Commission.

Pfizer expects to full the $43 billion Seagen buyout later this 12 months or in early 2024. 

The debt offering is anticipated to shut on May 19, in accordance to a prospectus supplement New York-based Pfizer filed with the SEC late Tuesday. 

The pharma big’s debt offering could be the biggest since CVS Health offered $40 billion of bonds in 2018 to finance its acquisition of well being insurer Aetna. 

Pfizer’s transfer comes as different firms together with Apple, T-Mobile and Merck rush to tap the U.S. bond market forward of a possible spike in borrowing prices sparked by the debt ceiling standoff. 

Pfizer’s inventory worth dropped barely on Wednesday.

The firm mentioned it should safe funding for the deal to purchase Bothell, Washington-based Seagen by means of eight tranches of notes that can mature between 2025 and 2063.

Each tranche is price $3 billion to $6 billion.

The yield to maturity on Pfizer’s 10-year bonds could be 4.75%, which is round 125 foundation factors greater than the U.S. 10-year Treasury be aware.

Signage exterior Seagen headquarters in Bothell, Washington, on Tuesday, March 14, 2023.

David Ryder | Bloomberg | Getty Images

Bank of America, Citigroup, Goldman Sachs and JPMorgan Chase are managing the debt sale. 

Pfizer in March agreed to purchase Seagen for $229 per share in money. 

On Monday, the 2 corporations submitted paperwork for his or her proposed merger to the Federal Trade Commission and the Department of Justice, kicking off a review period for the deal.

Investors are doubtless to monitor that high-stakes evaluation intently, notably in mild of the lawsuit filed Tuesday by the FTC searching for to block Amgen‘s proposed $27.8 billion acquisition of Horizon Therapeutics.

The Seagen deal is anticipated to strengthen Pfizer’s portfolio of most cancers medicine by bringing a category of antibody-drug conjugates, medicines which can be designed to straight kill most cancers cells and spare wholesome ones.

Seagen has 4 accepted most cancers therapies, which raked in combined sales of nearly $2 billion in 2022. 

Pfizer has mentioned it expects greater than $10 billion in “risk-adjusted” gross sales from Seagen in 2030.

That income might assist offset an ongoing decline in gross sales of Pfizer’s Covid vaccine and antiviral capsule Paxlovid because the world emerges from the pandemic, and depends much less on these merchandise.



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