Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA) announced last night that it had successfully priced the offering of $4.5 billion of senior notes. The offering was increased from $3.5 billion, which was announced just last week.
Net proceeds from the bonds will be used to repay $2.3 billion outstanding indebtedness, the company said, under Teva's dollar and Japanese yen term loan agreements and, together with cash on hand, to redeem all $1.5 billion aggregate principal amount of its 1.40% senior notes due 2018 and all $1.2 billion aggregate principal amount of its 2.875% senior notes due 2019.
Teva EVP and CFO Mike McClellan said, "With the successful pricing of $4.5 billion of senior notes, we have completed an important piece of our financial plan. Furthermore, having taken care of our financing requirements for the coming years, Teva will now focus on execution of our restructuring plan and optimization of our business."
Teva took on $34 billion in debt in 2016 to fund the $40 billion acquisition of Allergan's generics division Actavis. At the end of the fourth quarter of 2018, the debt had been reduced to $32.5 billion following the sale of assets and the issue of the new bonds is an attempt to recycle some of the debt.
The new bonds comprise $1.25 billion aggregate principal amount of 6% dollar senior notes maturing in 2024 and $1.25 billion aggregate principal amount of 6.75% dollar denominated senior notes maturing in 2028, as well as €700 million aggregate principal amount of 3.25% euro senior notes maturing in 2022 and €900 million aggregate principal amount of 4.5% euro senior notes maturing in 2025. The bonds will be issued by special purpose finance subsidiaries of Teva.
The settlement of the Notes is expected to occur on or about March 14, 2018, subject to customary closing conditions.
Published by Globes [online], Israel business news - www.globes-online.com - on March 8, 2018
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