By Paul A. Harris
Portland, Ore., April 28 – Pharmaceutical Product Development, LLC priced a $550 million issue of Eagle Holding Co. II LLC five-year PIK toggle holdco notes (Caa1/CCC+) at par to yield 7 5/8% late Thursday, according to market sources.
The yield printed in the middle of the 7½% to 7¾% guidance.
The notes will pay 8 3/8% PIK interest.
The order book was 4.5-times to 5-times oversubscribed, according a trader.
J.P. Morgan Securities LLC, Goldman Sachs & Co., Barclays, UBS Investment Bank and Jefferies LLC were the joint bookrunners.
Proceeds will be used to help fund a recapitalization of the Wilmington, N.C.-based contract research company.
The deal comes in conjunction with the company's announcement on Wednesday that its existing owners, affiliates of Hellman & Friedman and affiliates of the Carlyle Group, have entered into definitive agreements to recapitalize Pharmaceutical Product Development and expand the company’s ownership to include two new investors, a subsidiary of the Abu Dhabi Investment Authority and an affiliate of GIC, Singapore’s sovereign wealth fund (GIC). GIC and ADIA are longtime investors in Carlyle and Hellman & Friedman and now will be direct investors in Pharmaceutical Product Development.
Under the agreements, Hellman & Friedman will assume majority ownership and Carlyle will retain a substantial minority position in Pharmaceutical Product Development, both investing substantial equity from new funds. Hellman & Friedman and Carlyle will maintain majority joint ownership of the company.
| Issuer: | Eagle Holding Co. II LLC (Pharmaceutical Product Development, LLC)
|
| Amount: | $550 million
|
| Maturity: | May 15, 2022
|
| Securities: | PIK toggle notes
|
| Bookrunners: | J.P. Morgan Securities LLC, Goldman Sachs & Co., Barclays, UBS Investment Bank, Jefferies LLC
|
| Cash coupon: | 7 5/8%
|
| PIK coupon: | 8 3/8%
|
| Price: | Par
|
| Yield: | 7 5/8%
|
| Call protection: | One year
|
| Equity clawback: | All or a portion of the issue callable at 102 during the non-call period
|
| Trade date: | April 27
|
| Ratings: | Moody's: Caa1
|
| S&P: CCC+
|
| Price talk: | 7½% to 7¾%
|
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