Bristol-Myers Squibb shares spiked as much as 4% in afternoon trading on a Dow Jones report that Carl Icahn has purchased a stake in the pharma giant.
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The billionaire investor approves of Bristol-Myers' experimental drug pipeline and believes it to be an acquisition target, according to the Wall Street Journal. The size of Icahn's stake remains unknown, but it's reportedly a big one.
Icahn's involvement in Bristol-Myers Squibb could be a harbinger for a future deal. The noted activist has guided a number of prominent biopharma M&As to the finish line - ironically enough, he's actually convinced two companies to reject BMS bids outright or hold out for higher ones.
While Bristol-Myers shares closed in green territory Tuesday, its performance has been far more dire in recent times. The stock is down 14% over the last 12 months and 6% year-to-date over struggles in its star cancer immunotherapy franchise, which has lost some ground to rivals like Merck (mrk) in the lucrative lung cancer market.
But a lower market cap combined with a promising pipeline could create the perfect conditions for a takeover. Bristol-Myers has been shaking up its board in recent months and announced the addition of three new director positions on Tuesday.