By Rebecca Melvin
Concord, N.H., Nov. 16 – Zimmer Biomet Holdings, Inc. priced a $1.6 billion two-tranche offering of senior notes (Baa3/BBB/BBB) on Monday, according to a market source and an FWP filing with the Securities and Exchange Commission.
The company sold $850 million of 1.45% three-year notes at par. The notes priced at a spread to Treasuries of plus 58 basis points.
The notes have a make-whole call prior to maturity with a Treasuries plus 10 bps discount rate.
A $750 million tranche of 2.6% 10-year notes priced at 99.974 to yield 2.603%. The notes priced at a spread of Treasuries plus 98 bps.
The notes have a make-whole call prior to Aug. 24, 2031, with a Treasuries plus 15 bps discount rate, after which they are redeemable at par plus accrued interest.
There is a change-of-control put for both series of notes at 101%.
Barclays, Citigroup Global Markets Inc. and Goldman Sachs & Co. LLC are joint global coordinators and are bookrunners along with BNP Paribas Securities Corp., BofA Securities Inc., Mizuho Securities USA LLC, Morgan Stanley & Co. LLC, DNB Markets Inc., HSBC Securities (USA) Inc., RBC Capital Markets LLC and SMBC Nikko Securities America Inc.
Proceeds will be used to fund cash tender offers for any and all of the company’s 3.7% senior notes due 2023 and up to $1.5 billion of its 3.55% senior notes due 2025, 3.55% senior notes due 2030, 4.45% senior notes due 2045, 3.05% senior notes due 2026, 4.25% senior notes due 2035 and 5.75% senior notes due 2039.
Zimmer Biomet, based in Warsaw, Ind., designs, manufactures and markets orthopedic reconstructive and other products.
| Issuer: | Zimmer Biomet Holdings, Inc.
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| Amount: | $1.6 billion
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| Description: | Senior notes
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| Bookrunners: | Barclays, Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, BNP Paribas Securities Corp., BofA Securities Inc., Mizuho Securities USA LLC, Morgan Stanley & Co. LLC, DNB Markets Inc., HSBC Securities (USA) Inc., RBC Capital Markets LLC and SMBC Nikko Securities America Inc.
|
| Senior co-managers: | Credit Suisse Securities (USA) LLC, TD Securities (USA) LLC, UniCredit Capital Markets LLC and U.S. Bancorp Investments Inc.
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| Co-managers: | Academy Securities Inc., DZ Financial Markets LLC, Loop Capital Markets LLC, R. Seelaus & Co. LLC and Siebert Williams Shank & Co. LLC
|
| Trade date: | Nov. 15
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| Settlement date: | Nov. 24
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| Ratings: | Moody’s: Baa3
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| S&P: BBB
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| Fitch: BBB
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| Distribution: | SEC registered
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|
|
| Three-year notes
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| Amount: | $850 million
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| Maturity: | Nov. 22, 2024
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| Coupon: | 1.45%
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| Price: | Par
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| Yield: | 1.45%
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| Spread: | Treasuries plus 58 bps
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| Call features: | Make-whole call prior to Nov. 22, 2024 at a price equal to greater of par and Treasuries plus 10 bps
|
| Change-of-control put: | 101%
|
| Cusip: | 98956PAU6
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|
|
| 10-year notes
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| Amount: | $750 million
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| Maturity: | Nov. 24, 2031
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| Coupon: | 2.6%
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| Price: | 99.974
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| Yield: | 2.603%
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| Spread: | Treasuries plus 98 bps
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| Call features: | Make-whole call before Aug. 24, 2031 at price equal to greater of par and Treasuries plus 15 bps; thereafter at par
|
| Change-of-control put: | 101%
|
| Cusip: | 98956PAV4
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