Published on 5/13/2021 in the Prospect News Investment Grade Daily.
New Issue: LabCorp details $1 billion senior notes in tranches due 2026, 2031
By Devika Patel
Knoxville, Tenn., May 13 – Laboratory Corp. of America Holdings offered further details, including the price and yield, about a $1 billion sale of senior notes (Baa2/BBB) that priced in two parts on Wednesday, according to an FWP filed with the Securities and Exchange Commission.
Each tranche was sized at $500 million.
The issuer sold 1.55% notes due June 1, 2026 at Treasuries plus 70 basis points, tighter than talk in the Treasuries plus 95 bps to 100 bps area. These notes priced at 99.933 to yield 1.564%.
A 10-year tranche was sold with a 2.7% coupon and a Treasuries plus 105 bps spread, similarly tighter than talk in the 125 bps to 130 bps area. These notes priced at 99.652 to yield 2.74%.
BofA Securities, Inc., KeyBanc Capital Markets Inc. and Wells Fargo Securities, LLC are the active bookrunners. Passive bookrunners are MUFG, TD Securities (USA) LLC and U.S. Bancorp Investments Inc.
The company plans to use proceeds to redeem its outstanding 3.2% senior notes due Feb. 1, 2022 and 3.75% senior notes due Aug. 23, 2022 prior to their respective maturities, according to a press release.
Based in Burlington, N.C., LabCorp provides comprehensive clinical laboratory and end-to-end drug development services.
| Issuer: | Laboratory Corp. of America Holdings
|
| Issue: | Senior notes
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| Amount: | $1 billion
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| Bookrunners: | BofA Securities, Inc., KeyBanc Capital Markets Inc. and Wells Fargo Securities, LLC (active), MUFG, TD Securities (USA) LLC and U.S. Bancorp Investments Inc. (passive)
|
| Co-managers: | Barclays, Citigroup Global Markets Inc., Citizens Capital Markets, Inc., Credit Agricole Securities (USA) Inc., Credit Suisse Securities (USA) LLC, Fifth Third Securities, Inc., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, PNC Capital Markets LLC and Truist Securities, Inc.
|
| Trade date: | May 12
|
| Settlement date: | May 26
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| Ratings: | Moody’s: Baa2
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| S&P: BBB
|
|
|
| 2026 notes
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| Amount: | $500 million
|
| Maturity: | June 1, 2026
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| Coupon: | 1.55%
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| Price: | 99.933
|
| Yield: | 1.564%
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| Spread: | Treasuries plus 70 bps
|
| Call: | Make-whole call at Treasuries plus 12.5 bps until May 1, 2026, then a par call
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| Price talk: | Treasuries plus 95 bps to 100 bps area
|
|
|
| 2031 notes
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| Amount: | $500 million
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| Maturity: | June 1, 2031
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| Coupon: | 2.7%
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| Price: | 99.652
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| Yield: | 2.74%
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| Spread: | Treasuries plus 105 bps
|
| Call: | Make-whole call at Treasuries plus 20 bps until March 1, 2031, then a par call
|
| Price talk: | Treasuries plus 125 bps to 130 bps area
|
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