Lantheus refinances with new $400 million five-year credit facility

By Sarah Lizee

Olympia, Wash., July 1 – Lantheus Holdings, Inc. subsidiary Lantheus Medical Imaging, Inc. refinanced its existing debt on Thursday with a new $200 million five-year term loan facility and a new $200 million five-year revolving credit facility, according to an 8-K filing with the Securities and Exchange Commission.

Wells Fargo Bank, NA is the administrative agent.

Interest on the term loan and revolver is Libor plus plus a spread that ranges from 125 basis points to 225 bps, based on the company’s total net leverage ratio.

The new term facility amortizes at a rate ranging from 5% to 7.5% per year until its June 27, 2024 maturity date.

The revolver has a commitment fee that ranges from 15 bps to 30 bps, also depending on leverage.

The company may request an increase to the new term facility or request the establishment of one or more new incremental term loan facilities in an aggregate principal amount of up to $100 million, plus additional amounts in some circumstances.

The new revolver includes a $20 million sub-facility for the issuance of letters of credit and a $10 million sub-facility for swingline loans.

The new facility contains a number of affirmative, negative and reporting covenants, as well as a financial maintenance covenant under which the company is required to, among other things, be in quarterly compliance, measured on a trailing four quarter basis, with a total net leverage ratio of 4 to 1 through the quarter ending June 30, 2020, 3.75 to 1.00 through the quarter ending June 30, 2021 and 3.50 to 1.00 onwards.

The new facility is guaranteed by Lantheus Holdings and Lantheus MI Real Estate, LLC, and obligations under the new facility are generally secured by first-priority liens over substantially all of the assets of each of Lantheus Medical, Lantheus Holdings and Lantheus MI owned as of June 27, 2019 or thereafter acquired.

The new credit agreement replaces the company’s existing $275 million five-year term loan and its previous $75 million five-year revolver.

The net proceeds of the new term facility, together with about $73 million of cash on hand, were used to refinance in full the aggregate remaining principal amount of the loans outstanding under the old facility and pay related interest, transaction fees and expenses.

The revolver is expected to be used for working capital and for other general corporate purposes.

Lantheus Medical is a North Billerica, Mass.-based developer, manufacturer, seller and distributor of diagnostic imaging agents.

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