Published on 2/23/2024 in the Prospect News Investment Grade Daily.
New Issue: AbbVie prices $15 billion of senior notes in seven tranches
By William Gullotti and Cristal Cody
Buffalo, N.Y., Feb. 23 – AbbVie Inc. priced a $15 billion seven-tranche offering of senior notes (A3/A-) on Thursday to fund its acquisition of Cerevel Therapeutics, according to an FWP and a 424B5 filing with the Securities and Exchange Commission and details from a market source.
The overall offering, initially for six tranches, breaks down as follows:
• $2.25 billion of 4.8% notes due 2027, priced with a spread of 35 basis points over Treasuries at 99.859 to yield 4.849%. Price talk was in the Treasuries plus 60 bps area;
• $2.5 billion of 4.8% notes due 2029, priced with a spread of 50 bps over Treasuries at 99.793 to yield 4.846%. Spread talk was in the 75 bps area;
• $2 billion of 4.95% notes due 2031, priced with a spread of 60 bps over Treasuries at 99.896 to yield 4.967%. Spread talk was in the 90 bps area;
• $3 billion of 5.05% notes due 2034, priced with a spread of 75 bps over Treasuries at 99.685 to yield 5.09%. Spread talk was in the 100 bps area;
• $750 million of 5.35% notes due 2044, priced with a spread of 75 bps over Treasuries at 99.862 to yield 5.361%. Spread talk was in the 105 bps area;
• $3 billion of 5.4% notes due 2054, priced with a spread of 95 bps over Treasuries at 99.657 to yield 5.423%. Talk had the notes coming in the Treasuries plus 120 bps area; and
• $1.5 billion of 5.5% notes due 2064, priced with a spread of 105 bps over Treasuries at 99.626 to yield 5.523%. Spread talk was in the 130 bps area.
Each tranche features a make-whole call until some months prior to maturity, followed by a par call.
Morgan Stanley & Co. LLC, J.P. Morgan Securities LLC, BofA Securities, Inc. and Citigroup Global Markets Inc. are the joint bookrunning managers for all seven tranches, with each tranche also including two additional joint bookrunning managers.
HSBC Securities (USA) Inc. and SG Americas Securities, LLC are the additional joint bookrunning managers for the 2027 notes. Mizuho Securities USA LLC and Wells Fargo Securities, LLC are the additional joint bookrunning managers for the 2029 notes. SG Americas and Mizuho are also the additional joint bookrunning managers for the 2031 notes. HSBC is also an additional joint bookrunning manager for the 2034 notes with Deutsche Bank Securities Inc. Deutsche Bank is also an additional joint bookrunning manager for the 2044 notes with BNP Paribas Securities Corp. BNP Paribas is also an additional joint bookrunning manager for the 2054 notes with Barclays. Barclays and Wells Fargo are the additional joint bookrunning managers for the 2064 notes.
As previously reported, AbbVie intends to use the proceeds to repay loans incurred under its new term facility, totaling $5 billion, which were used to fund a portion of the consideration to acquire ImmunoGen, Inc., together with cash on hand, to fund the Cerevel Therapeutics merger consideration and to repay certain debt of Cerevel and its subsidiaries, to repay outstanding borrowings, totaling $1.7 billion, under its commercial paper program and for general corporate purposes.
AbbVie is a biopharmaceutical company based in North Chicago, Ill.
| Issuer: | AbbVie Inc.
|
| Amount: | $15 billion
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| Issue: | Senior notes
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| Bookrunners: | Morgan Stanley & Co. LLC, J.P. Morgan Securities LLC, BofA Securities, Inc. and Citigroup Global Markets Inc.
|
| Co-managers: | MUFG Securities Americas Inc., U.S. Bancorp Investments, Inc., Lloyds Securities Inc., Santander US Capital Markets LLC, TD Securities (USA) LLC, Siebert Williams Shank & Co., LLC, R. Seelaus & Co., LLC, CastleOak Securities, LP, Samuel A. Ramirez & Co., Inc. and Drexel Hamilton, LLC
|
| Trustee: | U.S. Bank Trust Co., NA
|
| Counsel to issuer: | Wachtell, Lipton, Rosen & Katz
|
| Counsel to underwriters: | Davis Polk & Wardwell LLP
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| Trade date: | Feb. 22
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| Settlement date: | Feb. 26
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| Ratings: | Moody’s: A3
|
| S&P: A-
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| Distribution: | SEC registered
|
|
|
| 2027 notes
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| Amount: | $2.25 billion
|
| Maturity: | March 15, 2027
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| Additional bookrunners: | HSBC Securities (USA) Inc. and SG Americas Securities, LLC
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| Additional co-managers: | Barclays, BNP Paribas Securities Corp., Deutsche Bank Securities Inc., Mizuho Securities USA LLC and Wells Fargo Securities, LLC
|
| Coupon: | 4.8%
|
| Price: | 99.859
|
| Yield: | 4.849%
|
| Spread: | Treasuries plus 35 bps
|
| Call: | Make-whole at Treasuries plus 10 bps until Feb. 15, 2027, followed by par call
|
| Price talk: | Treasuries plus 60 bps area
|
| Cusip: | 00287YDR7
|
|
|
| 2029 notes
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| Amount: | $2.5 billion
|
| Maturity: | March 15, 2029
|
| Additional bookrunners: | Mizuho Securities USA LLC and Wells Fargo Securities, LLC
|
| Additional co-managers: | Barclays, BNP Paribas Securities Corp., HSBC Securities (USA) Inc., Deutsche Bank Securities Inc. and SG Americas Securities, LLC
|
| Coupon: | 4.8%
|
| Price: | 99.793
|
| Yield: | 4.846%
|
| Spread: | Treasuries plus 50 bps
|
| Call: | Make-whole at Treasuries plus 10 bps until Feb. 15, 2029, followed by par call
|
| Price talk: | Treasuries plus 75 bps area
|
| Cusip: | 00287YDS5
|
|
|
| 2031 notes
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| Amount: | $2 billion
|
| Maturity: | March 15, 2031
|
| Additional bookrunners: | SG Americas Securities, LLC and Mizuho Securities USA LLC
|
| Additional co-managers: | Barclays, BNP Paribas Securities Corp., HSBC Securities (USA) Inc., Deutsche Bank Securities Inc. and Wells Fargo Securities, LLC
|
| Coupon: | 4.95%
|
| Price: | 99.896
|
| Yield: | 4.967%
|
| Spread: | Treasuries plus 60 bps
|
| Call: | Make-whole at Treasuries plus 10 bps until Jan. 15, 2031, followed by par call
|
| Price talk: | Treasuries plus 90 bps area
|
| Cusip: | 00287YDT3
|
|
|
| 2034 notes
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| Amount: | $3 billion
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| Maturity: | March 15, 2034
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| Additional bookrunners: | HSBC Securities (USA) Inc. and Deutsche Bank Securities Inc.
|
| Additional co-managers: | Barclays, BNP Paribas Securities Corp., SG Americas Securities, LLC, Mizuho Securities USA LLC and Wells Fargo Securities, LLC
|
| Coupon: | 5.05%
|
| Price: | 99.685
|
| Yield: | 5.09%
|
| Spread: | Treasuries plus 75 bps
|
| Call: | Make-whole at Treasuries plus 12.5 bps until Dec. 15, 2033, followed by par call
|
| Price talk: | Treasuries plus 100 bps area
|
| Cusip: | 00287YDU0
|
|
|
| 2044 notes
|
| Amount: | $750 million
|
| Maturity: | March 15, 2044
|
| Additional bookrunners: | BNP Paribas Securities Corp. and Deutsche Bank Securities Inc.
|
| Additional co-managers: | Barclays, HSBC Securities (USA) Inc., SG Americas Securities, LLC, Mizuho Securities USA LLC and Wells Fargo Securities, LLC
|
| Coupon: | 5.35%
|
| Price: | 99.862
|
| Yield: | 5.361%
|
| Spread: | Treasuries plus 75 bps
|
| Call: | Make-whole at Treasuries plus 12.5 bps until Sept. 15, 2043, followed by par call
|
| Price talk: | Treasuries plus 105 bps area
|
| Cusip: | 00287YDV8
|
|
|
| 2054 notes
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| Amount: | $3 billion
|
| Maturity: | March 15, 2054
|
| Additional bookrunners: | BNP Paribas Securities Corp. and Barclays
|
| Additional co-managers: | HSBC Securities (USA) Inc., Deutsche Bank Securities Inc., SG Americas Securities, LLC, Mizuho Securities USA LLC and Wells Fargo Securities, LLC
|
| Coupon: | 5.4%
|
| Price: | 99.657
|
| Yield: | 5.423%
|
| Spread: | Treasuries plus 95 bps
|
| Call: | Make-whole at Treasuries plus 15 bps until Sept. 15, 2053, followed by par call
|
| Price talk: | Treasuries plus 120 bps area
|
| Cusip: | 00287YDW6
|
|
|
| 2064 notes
|
| Amount: | $1.5 billion
|
| Maturity: | March 15, 2064
|
| Additional bookrunners: | Barclays and Wells Fargo Securities, LLC
|
| Additional co-managers: | BNP Paribas Securities Corp., HSBC Securities (USA) Inc., Deutsche Bank Securities Inc., SG Americas Securities, LLC and Mizuho Securities USA LLC
|
| Coupon: | 5.5%
|
| Price: | 99.626
|
| Yield: | 5.523%
|
| Spread: | Treasuries plus 105 bps
|
| Call: | Make-whole at Treasuries plus 20 bps until Sept. 15, 2063, followed by par call
|
| Price talk: | Treasuries plus 130 bps area
|
| Cusip: | 00287YDX4
|
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