Albemarle plans $1.5 billion notes for Rockwood purchase, secures loan commitments

By Susanna Moon

Chicago, July 18 – Albemarle Corp. plans to issue $1.5 billion of new senior notes to help finance its acquisition of Rockwood Holdings, Inc., according to an 8-K filing with the Securities and Exchange Commission by Rockwood.

Albemarle also lined up financing commitments to cover the cash amount needed for the buyout under a commitment letter signed Tuesday with Bank of America, NA and Bank of America Merrill Lynch.

Albemarle expects to fund the cash portion of the merger payment using $2.2 billion of cash on hand at Albemarle, Rockwood and the two companies’ respective subsidiaries, along with the $1.5 billion of debt financing from the new note proceeds.

Under the commitment letter, Bank of America also agreed to provide a $750 million replacement revolving credit facility if Albemarle cannot amend its existing revolving credit facility in connection with the acquisition.

Closing of the facilities is conditioned on completion of the merger.

As previously announced, Albemarle said it will fund its $6.2 billion acquisition of Rockwood Holdings, Inc. using a combination of cash and new debt.

The company will guarantee Rockwood’s $1.25 billion of notes due 2020.

Baton Rouge, La.-based Albemarle is a manufacturer of polymers and fine chemicals.

Princeton, N.J.-based Rockwood is a specialty chemicals and advanced materials company and is a wholly owned subsidiary Rockwood Specialties Group, Inc.

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