S&P affirms Jazz on upsizing

Standard & Poor's said it affirmed the BB+ rating on Jazz Pharmaceuticals plc's secured debt, following the company's announced plans to upsize those obligations.

The recovery rating of 2 remains unchanged and indicates 70% to 90% expected default recovery.

Jazz plans to upsize the $200 million revolver by $175 million and draw down about $250 million on that facility, while also increasing the $556 million in term loan debt by up to $400 million.

The company will use these funds, together with cash on hand, to fund the $1 billion acquisition of Gentium SpA and the initial $125 million payment for the acquisition of the rights to the ADX-N05 compound from Aerial BioPharma LLC, S&P said.

The ratings anticipated a rise in leverage from debt-financed acquisitions and is unaffected by this transaction, the agency said.

The ratings reflect the company's intermediate financial risk profile weak and business risk profile, S&P said.

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