Perrigo ups caps for two series in oversubscribed tender; pricing set

By Susanna Moon

Chicago, June 14 – Perrigo Co. plc and wholly owned subsidiary Perrigo Finance Unlimited Co. priced the tender for up to $1.4 billion principal amount of seven series of notes, which had been oversubscribed as of the early deadline at 5 p.m. ET on June 13.

Perrigo amended the terms of the offer that began May 31 to increase the series cap for the priority 3 notes to $410 million from $300 million, according to a company update on Wednesday.

The issuers expect to accept for purchase tenders for all of the priority 1 and 2 notes, as well as some priority 3 notes using a proration factor of about 57.9% and priority 4 notes using a proration factor of about 26.6%, the company said in another update later on Wednesday.

None of the priority 5 or 6 notes will be purchased in the offers, the company added.

The early tender breakdown is as follows, with pricing set at 11 a.m. ET on June 14 for each $1,000 principal amount using a reference security plus a fixed spread as follows, with the notes listed in order of priority acceptance level:

• $584,381,000 of Perrigo’s $800 million 4% notes due 2023 with pricing set at $1,074.82 using the 1.75% Treasury note due May 31, 2022 plus 100 basis points for a reference yield of 2.676%;

• $309,501,000 of Perrigo’s $400 million 5.3% notes due 2043 with pricing set at $1,125.60 using the 3% Treasury note due Feb. 15, 2047 plus 170 bps for a reference yield of 4.476%;

• $360,707,000 of Perrigo Finance’s $500 million 3.5% notes due March 2021 with pricing set at $1,046.41 using the 1.75% Treasury note due May 31, 2022 plus 50 bps for a reference yield of 2.176%; and $314,427,000 of its $500 million 3.5% notes due December 2021 with pricing set at $1,050.26 using the 1.75% Treasury note due May 31, 2022 plus 60 bps – with a sub-cap of $410 million, up from $300 million, for the two series of priority 3 notes for a reference yield of 2.276%; and

• $341.11 million of Perrigo Finance’s $400 million 4.9% notes due 2044 with pricing set at $1,057.95 using the 3% Treasury note due Feb. 15, 2047 plus 175 bps and a sub-cap of $150 million for a reference yield of 4.526%.

The issuers will accept for purchase $584,381,000 of the 4% notes, $309,501,000 of the 5.3% notes, $219,637,000 of the 3.5% notes due March 2021, $190,354,000 of the 3.5% notes due December 2021 and $96,127,000 of the 4.9% notes.

The total purchase price will include an early tender premium of $30 per $1,000 principal amount of notes tendered by the early tender deadline.

Holders will also receive accrued interest to but excluding the settlement date of June 15 for early tendered notes and on June 28 for remaining tenders.

The tenders are set to end at 11:59 p.m. ET on June 27, but the issuers will only accept more notes for purchase if they decide to amend the terms of the offers.

The issuers also were tendering for two other series of notes, but none of those notes will be purchased unless the offers are amended:

• Perrigo Finance’s $700 million 4.375% notes due 2026 with pricing to be set using the 2.375% Treasury note due May 15, 2027 plus 140 bps; and

• Perrigo Finance’s $700 million 3.9% notes due 2024 with pricing to be set using the 2.375% Treasury note due May 15, 2027 plus 115 bps.

Notes tendered before the early deadline will be given priority over those tendered afterward regardless of priority levels.

Barclays (800 438-3242 or 212 528-7581), Citigroup Global Markets Inc. (800 558-3745 or 212 723-6106) and Morgan Stanley & Co. LLC (800 624-1808 or 212 761-1057) are the lead dealer managers. Wells Fargo Securities, LLC (212 269-5550, 800 967-5071 or prgo@dfking.com) is the co-dealer manager.

D.F. King & Co., Inc. (212 269-5550, 800 967-5071 or prgo@dfking.com) is tender agent and information agent.

The health care company and maker of generic and over-the-counter pharmaceuticals is based in Allegan, Mich.

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