More and more, there are signs that the capital markets are finding equilibrium. For example, Pfizer Inc. (NYSE: PFE) was able to raise $13.5 billion in debt financing this week. The structure was a five-part issue of notes.
Of course, Pfizer needs the cash to pull off its $64.2 billion acquisition of Wyeth (NYSE: WYE).
In fact, the pharma industry is in the midst of a variety of deals; Merck & Co., Inc's (NYSE: MRK) $41.1 billion purchase of Schering Plough and Roche's $46.8 billion deal for Genentech, Inc. (NYSE: DNA).
And why not? Pharma giants need to find ways to fill up their pipelines. Besides, the industry has solid balance sheets. So, even in tough credit markets, pharma companies can still raise enormous amounts of financing.
And, the Pfizer deal is a nice fee pick-up for a variety of financial institutions, which include: Goldman Sachs Group (NYSE: GS), JP Morgan Chase & Co. (NYSE: JPM), Bank of America Corporation (NYSE: BAC), Citigroup, Inc. (NYSE: C) and Barclays.
However, keep in mind that the track record of mega M&A deals is somewhat spotty. But, when it comes to the pharma industry, the alternatives are limited – since internal R&D has been coming up short.
Tom Taulli is the author of various books, including The Complete M&A Handbook
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Reader Comments (Page 1 of 1)
3-31-2009 @ 8:52AM
Ryan For Pfizer Stock Market said...
Its rise can easdily be seen in Pfizer Share Price.Most important thing is that it is giving high dividends to its customers.