"The deal calls for Bristol-Myers to buy San Diego, Calif.-based Amylin for $31 a share. Including Amylin’s debt, the total value of the transaction is $7 billion. The shares will be acquired through a tender offer, following which the companies will undergo a second-step merger.
The deal gives Bristol-Myers a robust pipeline of type-2 diabetes drugs, including Amylin's novel GLP-1 franchise that houses Byetta and Bydureon, which is the first ever once-weekly therapy for type 2 diabetes patients"
"Under the terms of that deal, AstraZeneca will make a $3.4 billion cash payment to Amylin, which will be a wholly-owned subsidiary of Bristol-Myers. If AstraZeneca chooses to pay another $135 million, it will be able to establish equal governance rights over key strategic and financial decisions over Amylin"
The Astrazenca payment reduces the cost to BMY, which makes the new debt less than 1 yr of free cash flow for BMY. Total of all debt for BMY is less than 2 years of free cash flow which is still better than most of its peers.