ANI raises spread on $300 million term loan to Libor plus 600 bps

By Sara Rosenberg

New York, May 19 – ANI Pharmaceuticals Inc. increased pricing on its $300 million six-year term loan B to Libor plus 600 basis points from talk in the range of Libor plus 525 bps to 550 bps, according to a market source.

Also, the original issue discount on the term loan was changed to 98 from 98.5 and the 101 soft call protection was extended to one year from six months, the source said.

Furthermore, a 4.75x maximum total net leverage covenant was added to the previously covenant-lite term loan, the 50 bps MFN is for life with no carve-outs, revised from a 12 month sunset with certain carve-outs, the inside maturity exception basket was removed from incremental, investments are unlimited subject to 2x total net leverage, changed from subject to 2.5x total net leverage, and restricted payments are unlimited subject to 1.5x total net leverage, changed from subject to 2x total net leverage.

In addition, ticking fees on the term loan were outlined as half the margin from days 46 to 90 and the full margin thereafter.

The term loan still has a 0.75% Libor floor.

The company’s $340 million of credit facilities (B2/B+) also include a $40 million five-year revolver.

Truist Securities, Regions Capital Markets and Huntington Securities are the leads on the deal.

Recommitments were due at 5 p.m. ET on Tuesday, the source added.

Allocations are expected late this week or early next week.

Proceeds will be used to help fund the acquisition of Novitium Pharma and refinance existing ANI debt.

Novitium, an East Windsor, N.J.-based pharmaceutical company, is being purchased for $89.5 million in cash and $74 million in equity, plus two potential future cash earn-outs of up to $46.5 million.

Other funds for the transaction will come from a $25 million PIPE investment by Ampersand Capital Partners.

Closing is expected in the second half of this year, subject to regulatory approvals and approval by ANI shareholders.

ANI is a Baudette, Minn.-based specialty pharmaceutical company developing, manufacturing and marketing branded and generic prescription pharmaceuticals.

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