By Cristal Cody
Tupelo, Miss., Nov. 20 – Express Scripts Holding Co. priced a $1.4 billion three-tranche offering of guaranteed senior notes (Baa2/BBB+/BBB) on Monday, according to a market source and an FWP filing with the Securities and Exchange Commission.
Express Scripts placed $400 million of three-year floating-rate notes at par to yield Libor plus 75 basis points.
The company sold $500 million of 2.6% three-year notes at 99.977 to yield 2.608% and a spread of 75 basis points over Treasuries.
The $500 million tranche of 3.05% five-year notes priced at 99.793 to yield 3.095%, or a Treasuries plus 100 bps spread.
The tranches priced on the tight side of guidance.
Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC, BofA Merrill Lynch, Mizuho Securities USA Inc., Morgan Stanley & Co. LLC, RBC Capital Markets, LLC and Wells Fargo Securities, LLC were the bookrunners.
The notes are guaranteed by subsidiaries Express Scripts, Inc. and Medco Health Solutions, Inc.
Proceeds will be used to repay about $500 million of outstanding principal in the company’s term loan, fund a portion of the purchase price of its eviCore healthcare acquisition from CareCore National Group, LLC and for general corporate purposes.
Express Scripts Holdings is a pharmacy benefit management company based in St. Louis.
| Issuer: | Express Scripts Holding Co.
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| Guarantors: | Express Scripts, Inc. and Medco Health Solutions, Inc.
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| Amount: | $1.4 billion
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| Description: | Senior notes
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| Bookrunners: | Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC, BofA Merrill Lynch, Mizuho Securities USA Inc., Morgan Stanley & Co. LLC, RBC Capital Markets, LLC and Wells Fargo Securities, LLC
|
| Co-managers: | Credit Agricole Securities (USA) Inc., Loop Capital Markets LLC, Scotia Capital (USA) Inc., SMBC Nikko Securities America, Inc., SunTrust Robinson Humphrey, Inc., TD Securities (USA) LLC and U.S. Bancorp Investments, Inc.
|
| Change-of-control put: | 101%
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| Trade date: | Nov. 20
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| Settlement date: | Nov. 30
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| Ratings: | Moody’s: Baa2
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| S&P: BBB+
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| Fitch: BBB
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| Distribution: | SEC registered
|
|
|
| Three-year floaters
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| Amount: | $400 million
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| Maturity: | Nov. 30, 2020
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| Coupon: | Libor plus 75 bps
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| Price: | Par
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| Yield: | Libor plus 75 bps
|
| Call features: | Beginning first business day after one year date following issuance and thereafter at principal amount plus accrued and unpaid interest
|
| Price guidance: | Libor plus 75 bps-80 bps area
|
|
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| Three-year notes
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| Amount: | $500 million
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| Maturity: | Nov. 30, 2020
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| Coupon: | 2.6%
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| Price: | 99.977
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| Yield: | 2.608%
|
| Spread: | Treasuries plus 75 bps
|
| Call features: | Make-whole call at greater of par and Treasuries plus 15 bps before maturity
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| Price guidance: | Treasuries plus 80 bps area
|
|
|
| Five-year notes
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| Amount: | $500 million
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| Maturity: | Nov. 30, 2022
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| Coupon: | 3.05%
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| Price: | 99.793
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| Yield: | 3.095%
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| Spread: | Treasuries plus 100 bps
|
| Call features: | Make-whole call at greater of par and Treasuries plus 15 bps any time before 30 days prior to maturity; thereafter at par
|
| Price guidance: | Treasuries plus 105 bps area
|
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