Eli Lilly ( LLY) said Tuesday that it has commenced a tender offer for all outstanding shares of ImClone Systems ( IMCL) at $70 a share.

Lilly announced last week that it would buy ImClone for about $6.5 billion, not subject to any financing conditions. The price represents a premium of 51% to ImClone's closing stock price of July 30, the day before Bristol-Myers Squibb's ( BMY) offer was made public.

ImClone's board unanimously approved Lilly's proposal and recommended shareholders tender their shares in the offer. Unless extended, the tender and any withdrawal rights to which ImClone's shareholders might be entitled expire at midnight EST Nov. 20.

When the transaction is complete, ImClone will become a wholly owned subsidiary of Lilly. ImClone is best known for cancer drug Erbitux, which is currently approved for colon cancer and head and neck cancer in the U.S. It has a pipeline of five cancer drugs in early- and mid-stage clinical trials.

Bristol-Myers, which previously bid $62 a share for the cancer drug company, stands to gain about $1 billion for its roughly 14.4 million shares, or 16.6% of ImClone, through Lilly's acquisition.

ImClone shares closed at $67 on Monday. Eli Lilly closed at $35.86.

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