S&P assigns Sandoz BBB

S&P said it assigned its BBB long-term issuer credit rating to Sandoz Group AG and a BBB issue rating to its senior unsecured debt.

The outlook is stable.

Sandoz will be spun off from Novartis AG on Oct. 4, with Sandoz becoming the listed parent company for the spun-off division.

Sandoz has raised close to $3.8 billion worth of financing, including around $2.6 billion in bridge loans, nearly $750 million equivalent in term loans, and approximately $420 million under local bilateral facilities. It also has a $1.25 billion five-year revolving credit facility available that will remain fully undrawn at spinoff.

“The stable outlook reflects our forecast that Sandoz should be able to manage execution risks associated with its separation from Novartis, and gradually reduce debt to EBITDA to about 2x by the end of 2024, on the back of improving profitability and positive free cash flows,” S&P said in a news release.

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