The combined company will have more than $1 billion in annual sales.
It is unclear how the deal will impact Celgene employees in New Jersey.
Bristol-Myers Squibb is based in New York City, but has a sizeable presence in New Jersey.
Bristol-Myers Squibb Chairman and CEO Giovanni Caforio, in a news release, lauded the deal.
“Together with Celgene, we are creating an innovative biopharma leader, with leading franchises and a deep and broad pipeline that will drive sustainable growth and deliver new options for patients across a range of serious diseases,” he said.
Bristol-Myers Squibb and Celgene are both known for their cancer drugs, among other areas.
Here’s how the cash-and-stock deal will work out for investors, according to CNBC:
Shareholders of Celgene will receive one share of BSM stock, plus $50 in cash for each share they own. They’ll also receive one tradeable contingent value right for each Celgene share, allowing the holder to receive a payment when future regulatory milestones are hit.
The deal is valued at a premium of 53.7 percent to Celgene’s Wednesday close.
Shareholders of Bristol-Myers would own about 69 percent of the company, with Celgene shareholders owning about 31 percent.
Celgene shares surged 32 percent in premarket trading, to around $88 per share, while shares of Bristol-Myers Squibb were down more than 13 percent.