Bristol-Myers Squibb Announces Split-Off of Mead Johnson

Bristol-Myers Squibb Announces Split-Off of Mead Johnson

Completes Major Phase in Company's BioPharma Transformation
Provides Bristol-Myers Squibb Shareholders an Option for a Tax-Free Exchange
Expected to be Accretive to EPS Beginning in 2010
Reflects Strength and Sustainability of BioPharma Business

NEW YORK--(BUSINESS WIRE)--Bristol-Myers Squibb Company (NYSE: BMY) today announced it will split off its holdings in Mead Johnson Nutrition Company. The company expects the split-off to be a tax-advantaged way to further deliver value to Bristol-Myers Squibb shareholders. The split-off is expected to be net cash flow positive to the BioPharma business and accretive to earnings per share beginning in 2010.

"This marks the latest step in our company's transformation into a BioPharma leader," said James M. Cornelius, chairman and chief executive officer of Bristol-Myers Squibb. "By executing our healthcare divestment strategy, we have sharpened our BioPharma focus, improved the overall financial strength of the company and supported our ability to pursue strategic business development opportunities. All of these actions help us fulfill our mission to discover, develop and deliver innovative medicines to help patients prevail over serious diseases."

"Now is the right time to move forward with a split-off given the excellent performance of Mead Johnson since the IPO earlier this year and our confidence in the current and future performance of our biopharmaceuticals business. With a successful execution of this split-off, we fully consider ourselves a BioPharma company."

In the exchange offer, Bristol-Myers Squibb shareholders can exchange some, none or all of their shares of Bristol-Myers Squibb common stock for shares of Mead Johnson common stock. The exchange is generally expected to be tax-free to participating shareholders. As part of the exchange offer, Bristol-Myers Squibb will convert all of its Mead Johnson class B common stock into Mead Johnson class A common stock. Upon the completion of the exchange offer, only Mead Johnson class A common stock will remain outstanding.

The exchange offer is designed to permit Bristol-Myers Squibb shareholders to exchange shares of Bristol-Myers Squibb common stock for shares of Mead Johnson common stock at a discount.

Bristol-Myers Squibb is limited in what it can say under U.S. securities laws while the exchange offer is pending and as a result, the company has elected to postpone its investment community meeting originally planned for December 2, 2009 until 2010.

Details of the Exchange Offer

The price of Mead Johnson common stock is to be established by a formula as described below, subject to an upper limit of 0.6027 shares of Mead Johnson common stock per share of Bristol-Myers Squibb common stock. For each $1.00 of Bristol-Myers Squibb common stock accepted in the exchange offer, the tendering shareholder will receive approximately $1.11 of Mead Johnson common stock, subject to the upper limit on the exchange ratio.

The ratio at which shares of Bristol-Myers Squibb common stock and shares of Mead Johnson common stock will be exchanged will be determined by a 10 percent discount to the simple arithmetic average of the daily volume-weighted average prices of shares of Bristol-Myers Squibb common stock and Mead Johnson common shares, respectively, on the New York Stock Exchange over a three-day period currently expected to be December 8, 9, and 10, 2009. The final exchange ratio showing the number of shares of Mead Johnson common stock that Bristol-Myers Squibb shareholders participating in the exchange offer will receive for each share of Bristol-Myers Squibb common stock accepted for exchange will be announced by press release no later than 9:00 a.m., New York City time, on the trading day immediately preceding the expiration date of the exchange offer which is expected to be December 11, 2009.

The exchange offer will expire at 12:00 midnight, New York City time, on December 14, 2009, unless extended or terminated. The completion of the exchange offer is subject to certain conditions including that at least 144,500,000 shares of Mead Johnson common stock will be distributed in exchange for shares of Bristol-Myers Squibb common stock, receipt of an opinion of counsel that the exchange offer should qualify as tax-free, the continuing effectiveness and validity of a private letter ruling received from the Internal Revenue Service, the related Mead Johnson Registration Statement on Form S-4 being declared effective by the U.S. Securities and Exchange Commission (SEC) and there being no material adverse change in the U.S. financial markets.