On March 5, 2020 McKesson Corporation (NYSE:MCK) reported the final exchange ratio of 11.4086-for-one in connection with its previously announced offer to its stockholders to exchange their shares of McKesson common stock for shares of PF2 SpinCo, Inc. ("SpinCo") common stock (Press release, McKesson, MAR 5, 2020, View Source [SID1234555239]). The exchange offer to split-off SpinCo, which holds McKesson’s interest in Change Healthcare LLC ("Change Healthcare"), is part of McKesson’s agreement with Change Healthcare Inc. (NASDAQ:CHNG) ("Change") to merge SpinCo with and into Change.
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McKesson also announced that the upper limit on the number of SpinCo shares that can be received for each share of McKesson Common Stock tendered has been reached.
For each share of McKesson common stock that is validly tendered and accepted for exchange McKesson will deliver approximately 11.4086 shares of SpinCo common stock, which will be immediately converted into an equal number of shares of Change common stock upon completion of the proposed merger (subject to receipt of cash in lieu of fractional shares). The exchange offer and merger are generally expected to be tax-free to participating McKesson stockholders for U.S. federal income tax purposes except to the extent of any cash received in lieu of fractional shares of Change common stock. The transaction is subject to customary closing conditions.
McKesson will accept 15,426,537 shares of its common stock for exchange if the exchange offer is fully subscribed, based on the final exchange ratio. The exchange offer will be subject to proration if it is oversubscribed, and the number of shares accepted in the exchange offer may be fewer than the number of shares tendered.
The exchange offer is scheduled to expire at 11:59 p.m., New York City time, on March 9, 2020, unless it is extended or terminated. Holders of McKesson common stock may withdraw their tendered shares at any time before the expiration date of the exchange offer.
In connection with the transactions, Goldman Sachs & Co. LLC is acting as financial advisor and Davis Polk & Wardwell LLP is acting as legal advisor to McKesson.
For more information about the exchange offer, please visit www.dfking.com/McKesson or contact the information agent, D.F. King & Co., at 1-866-304-5477 (toll-free in the United States) or 1-212-269-5550 (outside of the United States), or by email at [email protected].