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Icahn Takes Bristol-Myers Stake With M&A In Mind; Who Could Be The Acquirer?

Elizabeth Balboa

Bristol-Myers Squibb Co (NYSE: BMY) shares spiked 4.5 percent Tuesday on news that Carl Icahn bought a stake in the company. According to the Wall Street Journal, Icahn allegedly considers Bristol-Myers a potential takeover target.

Earlier Tuesday, Bristol-Myers reported a $2 billion accelerated buyback.

The investor's expectation corroborates a January Bloomberg report acknowledging Bristol-Myers' fall from the fourth-best to the ninth-best biopharmaceutical company in the US. The company’s struggle to push its lung cancer drug, Opdivo, set it well behind competitor Merck & Co., Inc. (NYSE: MRK) and prompted a two-year plunge in stock value.

Now, as a more affordable company with a promising blood thinner and a potential use for Opdivo in melanoma and kidney cancer treatments, Bristol-Myers is well positioned for a buyout.

Related Link: Here's What Merck's Keytruda News Means For Bristol-Myers

Jefferies analyst Jeffrey Holford suggested in a recent note the company may appeal to Sanofi SA (ADR) (NYSE: SNY), Johnson & Johnson (NYSE: JNJ), Pfizer Inc. (NYSE: PFE) and Novartis AG (ADR) (NYSE: NVS) — but not likely Amgen, Inc. (NASDAQ: AMGN) or Gilead Science, Inc. (NASDAQ: GILD).

Meanwhile, Deutsche Bank analysts proposed Pfizer would likely be deterred by the short-term risk of immuno-oncology trials and wouldn't make a bid.

Bristol-Myers stock waned from its post-news peak and traded at $54.78 at the time of publication.

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