As the rumor mill churned with news of Amgen taking out Immunex, the size of the combined mega-biotech continued to shrink as AMGN's shares tumbled amid uncertainty over the presumed deal terms. In fact, AMGN's loss of market cap last week ($11.3 billion) approached the value of IMNX going into the week ($13.6 billion), leading to the preposterous conclusion that IMNX suddenly has hardly any value to add to the deal (see Cover Story).

AMGN, which lost $10.77 to $56.03 on the week, and IMNX, which traded up $0.65 to $25.62, now stand valued at $58.8 billion and $14 billion, respectively.

The Street hasn't yet fingered the leaker, but AMGN CEO Kevin Sharer can't be happy that the word got out. Thanks to last week's 16% haircut at the M&A barber, AMGN now would have to issue an additional 48.9 million shares to close the deal, assuming it goes off at Friday's close and at the low end of the $17-$20 billion valuation postulated by the rumor mill last week.

That extra dilution also would give current IMNX shareholders - American Home Products (AHP) included - an extra 2% cut of the combined company. At $56.03, AMGN would have to issue 303.4 million shares to get to $17 billion. Had the deal closed a week earlier, when AMGN was changing hands at $66.80, IMNX would have fetched 254.5 million shares. Thus, IMNX shareholders would get 22% instead of 20%.

Democratic distribution

The U.S. markets last week spread public equity money between IPOs, follow-ons and PIPEs, the first time that has happened since the second week of March. Over the balance of the year, fundraising has tended to come in flavor-of-the-day packages, with the lion's share going to one category. Two weeks ago, for example, follow-ons raised $427.4 million, while IPOs were shut out. Last week, two IPOs raised $78.5 million, seven pipes raised $111.4 million and one follow-on raised $109.2 million.