Acquisition-Related Information for Celgene Shareholders
Tax Implications of Celgene Acquisition
IRS Form 8937
Please see the below form, “Report of Organization Actions Affecting Basis of Securities,” for tax consequences of debt securities exchanged during the transaction.
See below for additional tax information for Celgene shareholders as a result of the acquisition:
As noted in the related Form S-4, the exchange of shares of Celgene common stock for the merger consideration pursuant to the merger was a taxable transaction for U.S. federal income tax purposes.
Accordingly, a Celgene stockholder that is a U.S. holder(1) will recognize taxable capital gain or loss in an amount equal to the difference, if any, between (i) the sum of (A) the amount of cash, including cash in lieu of fractional shares, received by such U.S. holder in the merger, (B) the fair market value of the shares of Bristol Myers Squibb common stock received by such U.S. holder in the merger, and (C) the fair market value of the CVRs received by such U.S. holder in the merger, each determined on the date of the completion of the merger and (ii) such U.S. holder’s adjusted tax basis in the shares of Celgene common stock exchanged therefor.
Since receipt of the merger consideration is taxable, a holder’s initial aggregate tax basis in BMS common stock and in the CVRs received in the merger will be equal to the FMV of the stock and CVRs as of the date of the merger, which equaled the trading price of BMS stock and CVRs on the merger date.
For reference, those values are as follows:
- For BMY stock, $56.41 (2)
- For CVRs, $2.30 (3)
With respect to a Celgene stockholder that is a non-U.S. holder(1), the exchange of shares of Celgene common stock for the merger consideration pursuant to the merger generally will not result in tax to such non-U.S. holder under U.S. federal income tax laws unless such non-U.S. holder has certain connections with the United States.
Each former Celgene stockholder is urged to read the section in the S-4 entitled “Celgene Proposal I: Adoption of the Merger Agreement and Bristol Myers Squibb Proposal I: Approval of the Stock Issuance—Material U.S. Federal Income Tax Consequences” beginning on page 165 and to consult its tax advisor to determine the particular U.S. federal, state or local or non-U.S. income or other tax consequences to it of the merger.
(1)as defined in the Form S-4 filed with the SEC on February 20, 2019 under the heading “Celgene Proposal I: Adoption of the Merger Agreement and Bristol Myers Squibb Proposal I: Approval of the Stock Issuance—Material U.S. Federal Income Tax Consequences” beginning on page 165.
(2)represents the closing price on 11/20, the close date of the transaction
(3)represents the opening price on 11/21, the first day of trading for CVRs
For additional questions, please contact EQ Shareholder Services:
For registered shareholders:
1-855-598-5485 toll-free within the U.S.
1-651-450-4064 from outside the U.S.
If you hold shares through a financial institution or broker:
1-833-503-4131 toll-free within the U.S.
To contact EQ in writing:
EQ Shareowner Services
1110 Centre Pointe Curve, Suite 101
Mendota Heights, MN 55120