Mylan gets $1.6 billion two-year term loan credit facility

By Susanna Moon

Chicago, July 21 – Mylan NV obtained a $1.6 billion two-year term loan credit facility last Wednesday, according to an 8-K filing with the Securities and Exchange Commission.

The facility consists of a $1 billion closing date term loan borrowed last Wednesday and a delayed draw term loan for up to $600 million, which may be drawn by Sept. 15.

Interest on the loans will be Libor plus 137.5 basis points.

Proceeds of the closing date term loan were used to redeem the company’s 7.875% senior notes due 2020 on July 15.

The company also may repay its 3.75% cash convertible notes due 2015 using proceeds of the delayed draw term loan.

Bank of Tokyo - Mitsubishi UFJ, Ltd., Deutsche Bank AG New York Branch, Goldman Sachs Bank USA, DNB Bank ASA Grand Cayman Branch and PNC Bank, NA are lenders, with PNC Bank as the administrative agent.

The loans will be unsecured and will be guaranteed by the company and each subsidiary of the company that guarantees third-party debt of the company in excess of $350 million. As of July 15, no subsidiary of the company was required to provide a guarantee of the credit facility.

The credit agreement contains a financial covenant requiring maintenance of a maximum ratio of 3.75 times for consolidated total debt as of the end of any quarter to consolidated EBITDA for the trailing four quarters.

Following certain qualifying acquisitions, at the company’s election, the maximum ratio in the financial covenant may be increased to 4.25 times for the three full quarters following the qualifying acquisition.

In addition, for the four fiscal quarters following the closing of the company’s offer for the entire issued and to be issued share capital of Perrigo, the maximum ratio in the financial covenant will be increased to 4.75 times, for each of the subsequent two fiscal quarters, the maximum ratio in the financial covenant will be decreased to 4.25 times and for any fiscal quarter thereafter, the maximum ratio in the financial covenant will return to 3.75 times.

The loans will mature on July 15, 2017, subject to extension to the earlier of Dec. 19, 2017 and, if different, the maturity date of the credit agreement dated Dec. 19, 2014 with Bank of America, NA as administrative agent.

Mylan is a pharmaceutical company based in Hatfield, England.

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