Merck (NYSE:MRK), known as MSD outside the United States and
Canada, on behalf of its wholly owned subsidiary Cubist
Pharmaceuticals, Inc., today announced that, in connection with the
completion of the acquisition of Cubist by Merck, Cubist has
commenced a tender offer (the “Convertible
Notes Tender Offer”) to repurchase, at the option of each
holder, any and all of its outstanding 2.50% Convertible Senior
Notes due 2017 (the “2017 Convertible
Notes”), 1.125% Convertible Senior Notes due 2018 (the
“2018 Convertible Notes”) and 1.875%
Convertible Senior Notes due 2020 (the “2020
Convertible Notes” and together with the 2017 Convertible
Notes and 2018 Convertible Notes, the “Convertible Notes”). Earlier in the day on January
21, 2015, Merck completed the tender offer for all of the
outstanding shares of common stock of Cubist, consummated the
merger of Cubist into Mavec Corporation, Inc., a wholly owned
subsidiary of Merck, and terminated trading of Cubist’s common
stock on the Nasdaq Global Select Market, each of which constituted
a Fundamental Change (as defined in each of the indentures
governing the Convertible Notes (the “Indentures”)) triggering Cubist’s obligation to
commence the Convertible Notes Tender Offer.
Pursuant to the terms of the Convertible Notes Tender Offer,
each holder of the Convertible Notes has the right (the
“Fundamental Change Repurchase Right”)
to require Cubist to repurchase for cash its Convertible Notes, or
any portion of the principal amount thereof that is equal to $1,000
or an integral multiple of $1,000, on February 23, 2015 (the
“Fundamental Change Repurchase Date”).
The repurchase price (the “Fundamental Change
Repurchase Price”) for Convertible Notes validly surrendered
and not validly withdrawn will be 100% of the principal amount of
the Convertible Notes being repurchased, plus accrued and unpaid
interest, if any, to, but excluding, the Fundamental Change
Repurchase Date. Holders may surrender their Convertible Notes from
January 22, 2015 until 11:59 p.m., Eastern Time, on February 19,
2015 (the “Fundamental Change Expiration
Date”). Tenders of the Convertible Notes must be made prior
to the expiration of the Convertible Notes Tender Offer and may be
withdrawn at any time prior to the expiration of the Convertible
Notes Tender Offer through compliance with the proper withdrawal
procedures outlined in the Fundamental Change Repurchase Right
Notice, Notice of Right to Convert, Notice of Entry into
Supplemental Indenture and Offer to Repurchase to Holders of the
Convertible Notes dated January 22, 2015 (the “Offer to Repurchase”).
To exercise the Fundamental Change Repurchase Right to have
Cubist repurchase the Convertible Notes and receive payment of the
Fundamental Change Repurchase Price, holders must validly surrender
their Convertible Notes to The Bank of New York Mellon Trust
Company, N.A. as paying agent (the “Paying
Agent”) prior to 11:59 p.m., Eastern Time, on the
Fundamental Change Expiration Date. The Bank of New York Mellon
Trust Company, N.A., the trustee under the Indenture (the
“Trustee”), has informed Cubist that,
as of January 22, 2015, all Convertible Notes are held through The
Depository Trust Company (“DTC”) and
that there are no certificated Convertible Notes in non-global
form. Accordingly, all Convertible Notes surrendered for repurchase
or conversion must be delivered through the Automated Tender Offer
Program transmittal procedures of DTC.
In addition, Merck has also announced on behalf of Cubist that,
pursuant to each Indenture, the Convertible Notes are convertible,
at the option of the holder, at any time until February 23, 2015.
The applicable Conversion Rate (as defined in the applicable
Indenture) for 2017 Convertible Notes is 34.66199631, for the 2018
Convertible Notes is 13.17448859 and for the 2020 Convertible Notes
is 13.51652926, in each case for such Convertible Notes converted
prior to February 23, 2015. The right of holders to convert their
Convertible Notes is separate from the Fundamental Change
Repurchase Right. Convertible Notes that a holder has surrendered
for repurchase pursuant to the Fundamental Change Repurchase Right
may be converted only if such holder first validly withdraws such
Convertible Notes from the Convertible Notes Tender Offer through
compliance with the proper withdrawal procedures outlined in the
Offer to Repurchase.
Holders should review the Offer to Repurchase carefully and
consult with their own financial and tax advisors. None of Cubist,
Merck or any of their respective affiliates, their respective
boards of directors, employees, advisors or representatives, the
Trustee, the Paying Agent or the Conversion Agent are making any
representation or recommendation to any holder as to whether or not
to tender or refrain from tendering its Convertible Notes in the
Convertible Notes Tender Offer, or to exercise their conversion
rights (if at all).
The Paying Agent and Conversion Agent for the Convertible Notes
Tender Offer is The Bank of New York Mellon Trust Company, N.A.,
525 William Penn Place, 38th Floor, Pittsburgh, Pa. 15259,
Attention: Corporate Trust Administration, 412-236-1201. The
Information Agent for the Convertible Notes Tender Offer is
MacKenzie Partners, 105 Madison Avenue, New York, N.Y. 10016,
800-322-2885 or 212-929-5500. Any questions and requests for
assistance in connection with the Convertible Notes Tender Offer or
conversion of the Convertible Notes may be directed to the Paying
Agent, the Conversion Agent and the Information Agent. The Offer to
Repurchase detailing the purchase option and the conversion rights
is being sent by Cubist to DTC as sole record owner of the
Convertible Notes.
This press release is for informational purposes only and does
not constitute an offer to buy or the solicitation of an offer to
sell the Convertible Notes. The Convertible Notes Tender Offer is
being made only pursuant to a Tender Offer statement (including the
offer to repurchase and related materials) that Cubist will file
with the securities and exchange commission (“SEC”) and thereafter distribute to its
Noteholders. Noteholders and investors should read carefully the
Tender Offer statement because it contains important information,
including the various terms of, and conditions to, the Convertible
Notes Tender Offer. Noteholders can obtain their documents when
they are filed and become available free of charge from the SEC’s
website at www.sec.gov, or by contacting Merck at 2000 Galloping
Hill Road, Kenilworth, N.J., 07033, 908-740-4000.
About Merck
Today’s Merck is a global healthcare leader working to help the
world be well. Merck is known as MSD outside the United States and
Canada. Through our prescription medicines, vaccines, biologic
therapies and animal health products, we work with customers and
operate in more than 140 countries to deliver innovative health
solutions. We also demonstrate our commitment to increasing access
to healthcare through far-reaching policies, programs and
partnerships. For more information, visit www.merck.com and connect
with us on Twitter, Facebook and YouTube.
Merck Forward-Looking Statement
This news release includes “forward-looking statements” within
the meaning of the safe harbor provisions of the U.S. Private
Securities Litigation Reform Act of 1995. Forward-looking
statements include statements regarding the timing and closing of
the Convertible Notes Tender Offer and any assumptions underlying
the foregoing. These statements are based upon the current beliefs
and expectations of Merck’s management and are subject to
significant risks and uncertainties. There can be no guarantees
with respect to pipeline products that the products will receive
the necessary regulatory approvals or that they will prove to be
commercially successful. If underlying assumptions prove inaccurate
or risks or uncertainties materialize, actual results may differ
materially from those set forth in the forward-looking
statements.
Risks and uncertainties include but are not limited to, general
industry conditions and competition; general economic factors,
including interest rate and currency exchange rate fluctuations;
the impact of pharmaceutical industry regulation and health care
legislation in the United States and internationally; global trends
toward health care cost containment; technological advances, new
products and patents attained by competitors; challenges inherent
in new product development, including obtaining regulatory
approval; Merck’s ability to accurately predict future market
conditions; manufacturing difficulties or delays; financial
instability of international economies and sovereign risk;
dependence on the effectiveness of Merck patents and other
protections for innovative products; and the exposure to
litigation, including patent litigation, and/or regulatory actions;
and timing of the Convertible Notes Tender Offer.
Merck undertakes no obligation to publicly update any
forward-looking statement, whether as a result of new information,
future events or otherwise except as required by applicable law.
Additional factors that could cause results to differ materially
from those described in the forward-looking statements can be found
in Merck’s 2013 Annual Report on Form 10-K and the company’s other
filings with the Securities and Exchange Commission (SEC) available
at the SEC’s Internet site (www.sec.gov).
MerckMedia:Lainie Keller, 908-236-5036Steve Cragle,
908-740-1801orInvestor:Joe Romanelli, 908-740-1986Justin Holko,
908-740-1879
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