Express Scripts gets $5.5 billion of term loans, $2 billion revolver

By Angela McDaniels

Tacoma, Wash., April 28 – Express Scripts Holding Co. entered into a credit agreement on Tuesday that provides for a $2.5 billion two-year term loan, a $3 billion five-year term loan and a $2 billion revolving loan facility, according to an 8-K filing with the Securities and Exchange Commission.

The interest rate is Libor plus a margin that ranges from 87.5 basis points to 137.5 bps for the two-year term loan, 100 bps to 150 bps for the five-year term loan and 90 bps to 130 bps for the revolver.

The commitment fee on the revolver ranges from 10 bps to 20 bps, depending on the company’s consolidated leverage ratio.

The two-year term loan will mature on April 28, 2017, and the five-year term loan and the revolver will both mature on April 28, 2020.

The two-year term loan will not require any amortization, and the five-year term loan will amortize in equal quarterly installments in an annual amount of 5% in the first two years, 10% in the third year, 15% in the fourth year and 65% in the fifth year, with the balance payable at maturity.

Credit Suisse Securities (USA) LLC and Citigroup Global Markets Inc. are the lead arrangers and bookrunners. Bank of America, NA, JPMorgan Chase Bank, NA, Mizuho Bank Ltd., Bank of Tokyo-Mitsubishi UFJ, Ltd. and Royal Bank of Canada are the co-lead arrangers, bookrunners and co-documentation agents. Bank of Nova Scotia, Credit Agricole Corporate and Investment Bank, Intesa Sanpaolo SpA, Morgan Stanley Bank, NA, Sumitomo Mitsui Banking Corp., SunTrust Bank, TD Bank, NA, U.S. Bank NA and Wells Fargo Bank, NA are the co-arrangers and co-documentation agents. Credit Suisse AG, Cayman Islands Branch is the administrative agent. Citibank, NA is the syndication agent.

On the closing date, $5.5 billion was made available to the company under the term loans, and the company borrowed $1.1 billion under the revolver.

The term loans are available for the company’s working capital needs and for general corporate purposes. The revolver was available on the closing date to repay some existing debt and will be available after the closing date for the company’s working capital needs and for general corporate purposes.

The obligations under the credit agreement are guaranteed by a portion of the domestic subsidiaries of the company.

In connection with the new credit agreement, the company’s Aug. 29, 2011 credit agreement was repaid and terminated.

The pharmaceutical benefits management company is based in St. Louis.

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