Baxter gets $11.4 billion bridge loan commitment for Hillrom buy

By Sara Rosenberg

New York, Sept. 2 – Baxter International Inc. has received a commitment for an $11.4 billion 364-day senior unsecured bridge loan to support its acquisition of Hillrom, according to an 8-K filed with the Securities and Exchange Commission on Thursday.

JPMorgan Chase Bank and Citigroup Global Markets Inc. provided the debt commitment.

The company expects to replace the bridge loan prior to the closing of the acquisition with permanent financing, which may include the issuance of debt securities and a term loan.

Baxter is committed to maintaining a solid investment-grade credit rating.

Projected net leverage at close is around 4.2x, with the target being to delever to 2.75x within two years of closing.

Under the agreement, Hillrom is being bought for $156.00 per share in cash for a total equity value of approximately $10.5 billion and a total enterprise value of about $12.4 billion, including the assumption of debt.

Other funds for the transaction will come from cash on hand.

Closing is expected by early 2022, subject to the approval of Hillrom shareholders and the satisfaction of customary conditions, including regulatory approvals.

Baxter is a Deerfield, Ill.-based medical products company. Hillrom is a Chicago-based medical technology company.

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