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BMS to split-off Mead Johnson

US firm elects to split-off nutrition company to focus on its biopharmaceuticals business

Bristol-Myers Squibb (BMS) has revealed plans to split-off its holdings in Mead Johnson Nutrition Company to concentrate on furthering its biopharmaceuticals business.

The split-off is expected to be net cash flow positive to BMS' biopharma business and accretive to earnings per share in 2010.

"By executing our healthcare divestment strategy, we have sharpened our biopharma focus, improved the overall financial strength of the company and supported our ability to pursue strategic business development opportunities," said BMS chairman and CEO, James M Cornelius.

"All of these actions help us fulfil our mission to discover, develop and deliver innovative medicines to help patients prevail over serious diseases," he added.

In the exchange offer, BMS shareholders can exchange some, none or all of their shares of BMS common stock for shares of Mead Johnson common stock. As part of the offer, BMS will convert all of its Mead Johnson class B common stock into Mead Johnson class A common stock.

The price of Mead Johnson common stock is to be calculated by a formula: the ratio at which BMS common stock and shares of Mead Johnson common stock will be exchanged will be determined by a 10 per cent discount to the simple arithmetic daily volume-weighted average prices of shares of both companies, respectively, on the New York Stock Exchange over a three-day period, currently pencilled as December 8, 9 and 10.

The exchange offer will expire at midnight New York City time on December 14, 2009, unless extended or terminated. The completion of the exchange offer is subject to certain conditions including that at least 144,500,000 shares of Mead Johnson common stock will be distributed in exchange for BMS common stock.

BMS owns 170,000,000 shares of Mead Johnson class A and class B common stock, representing 97.5 per cent of the voting interest and 83.1 per cent of the economic interest in the company.

Under US securities law BMS is limited to what it can say while the exchange offer is pending. As a result the company has decided to postpone until 2010 the investment community meeting scheduled for December 2, 2009.

17th November 2009

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