Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA) is preparing for debt recycling measures. The company announced today plans to issue $2.06 billion of sustainability-linked senior notes and at the same time began tender offers to purchase up to $2.25 billion of notes.
The new senior notes will be issued partly in US dollars and partly in euros. The notes that Teva is offering to buy from investors include Series 1 due for repayment in one year bearing interest of 2.8%. In addition there are other notes due for repayment between 2024 and 2026 bearing interest of between 3.15% and 7.125%.
Teva says the offers are aimed at proactively managing and extending the maturity profile of its debt.
At the end of 2022, Teva's net debt totaled $21.2 billion, of which 10% was defined as short term debt with an average maturity of 5.8 years. In recent years the Israeli pharmaceutical company has cut its net debt from a peak of about $37 billion, after the acquisition of Activis in 2016. In order to service its debt, the company was forced to implement a wide-ranging streamlining plan, which involved major layoffs and shutting down plants.
Teva's previous round of debt recycling was in 2021 when the company issued $5 billion in sustainability-linked senior notes. The notes issued then included several series due to mature in 2027-2030.
Teva is today managed by president and CEO Richard Francis who replaced Kare Schultz at the beginning of the year. The pharmaceutical company's share price fell 1% on the NYSE on Friday to $9.91, giving a market cap of $11.141 billion. Teva's share price is up 1.01% at $10.01 in premarket trading.
Published by Globes, Israel business news - en.globes.co.il - on February 27, 2023.
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