Mylan gets $2 billion three-year loan, $2 billion five-year revolver

By Angela McDaniels

Tacoma, Wash., Nov. 29 – Mylan NV entered into credit agreements on Nov. 22 that provide for a $2 billion senior term loan due Nov. 22, 2019 and a $2 billion multicurrency revolving credit facility due Nov. 22, 2021, according to an 8-K filing with the Securities and Exchange Commission.

The new credit facilities are guaranteed by Mylan Inc.

The interest rate is Libor plus 137.5 basis points for the term loan and Libor plus 120 bps for the revolver. The facility fee for the revolver is 17.5 bps. Pricing fluctuates based on the company’s ratings.

The term loan has no required amortization payments and may be voluntarily prepaid without penalty or premium.

The new revolver has a $200 million subfacility for letters of credit and a $175 million sublimit for swingline borrowings.

Each credit agreement contains a financial covenant requiring maintenance of a maximum ratio of 3.75 to 1.00 for consolidated total debt to consolidated EBITDA. Following certain qualifying acquisitions, including the company’s acquisition of Meda AB on Aug. 5, the company can elect to increase the leverage cap to 4.25 to 1.00 for the three full quarters following the qualifying acquisition.

The company may seek additional commitments under the revolver up to an amount such that the company would be in compliance with the maximum leverage financial covenant after giving effect to the increase in the commitments and the application of proceeds.

The credit facilities will be used to repay debt and for working capital expenditures and other corporate purposes.

Goldman Sachs Bank USA is the administrative agent for the term loan, and Bank of America, NA is the administrative agent for the revolver.

The effectiveness of the credit agreements was concurrent with, and contingent upon, the termination of the company’s Dec. 19, 2014 term credit agreement with Bank of America, NA as administrative agent and July 15, 2015 term credit agreement with PNC Bank, NA as administrative agent.

Mylan is a pharmaceutical company based in Hatfield, England.

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