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Mead Johnson preps for IPO

This article was originally published in The Tan Sheet

Executive Summary

An initial public offering for Bristol-Myers Squibb's subsidiary, Mead Johnson Nutrition, will initialize the week of Feb. 9 at a price of $21 to $24 per share of Class A common stock, which will trade under the ticker symbol MJN. Net proceeds are estimated at $530 million to $610 million, depending on whether underwriters exercise over-allotment actions, according to a prospectus filed Jan. 28. Based on the implied IPO price, the marketer of Enfamil pediatric formula likely will have 200 million shares and a market value of $4.5 billion, according to Deutsche Bank analyst Barbara Ryan. BMS intends to maintain an 80 percent to 90 percent ownership stake in Mead Johnson, which generated $2.88 billion in net sales in 2008. In April 2008, BMS announced plans to spin off the nutritionals business in an IPO rather than sell it (1"The Tan Sheet," April 28, 2008, p. 14)

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