Imagine That: An IPO Coming This Week (BMY, MJN)

If you can believe it, there is an initial public offering on deck this week. Bristol-Myers Squibb Co. (NYSE: BMY) is set to partially spin off Mead Johnson Nutrition (NYSE: MJN). It looks like it is actually going to come to market as many have hoped.

Mead Johnson Nutrition is the company’s infant formula and pediatric nutrition products operation.  We saw initial terms of the deal at the end of January with an indication of 25 million shares with a $21.00 to $24.00 expected price range. Citigroup and Morgan Stanley are listed as joint bookrunners, and Banc of America, Credit Suisse, J.P.Morgan, RBC, UBS, and Lazard are listed as the co-managers of the underwriting.

Jim Cramer was out with another dreaded pre-IPO call, predicting MJN would go higher. That’s  assuming you get in at the IPO price.

This is tentatively the first real IPO of the year, and would actually be the second IPO since August. Just keep in mind that this one is a unit of a large public company, so its status as a true blue IPO is debatable.

The current market conditions, the status of the banking stocks, and the stimulus and rescue package are all wild cards that could affect this deal. It  seems as though Bristol-Myers will either be underselling on price or that investors will wish they had waited. We initially had a tentative pricing set for Tuesday night, but we know better than to hang our hats on any solid date. Or terms, for that matter.

JON C. OGG
February 9, 2009