S&P rates ANI B+

S&P said it assigned ANI Pharmaceuticals Inc., its planned $300 million senior secured term loan and $40 million senior secured revolver B+ ratings. The recovery rating on the loans is 3 (50%).

ANI will use the loans and $99 million of equity to acquire Novitium for $163.5 million and four dermatology products from Sandoz Inc. for $20.6 million, refinance $186.9 million of debt, add cash to the balance sheet and pay fees and expenses.

“We expect ANI to maintain adjusted gross debt to EBITDA of 3x-4x. This reflects relatively quick deleveraging from the low-4x area in 2021 to about 3x in 2022 from new product launches, and a moderate level of acquisitions. We think the company will successfully launch enough generic products from Novitium to offset normal low-double-digit-percent revenue declines in the base business in 2021, with additional launches exceeding revenue declines in 2022,” S&P said in a press release.

The agency assigned a positive outlook. “The positive outlook reflects the upside to our base case from the potential approval and launch of ANI's Cortrophin product, which would contribute substantial revenues, lessen the need for M&A, and provide greater financial flexibility,” S&P said.

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