Endo plans to get term loans, bonds for Par Pharmaceutical purchase

By Sara Rosenberg

New York, May 18 – Endo International plc expects to use term loans and bonds to help fund its acquisition of Par Pharmaceutical Holdings Inc., company officials said in a conference call on Monday.

Deutsche Bank and Barclays provided the financing commitment.

The weighted average cost of debt is anticipated to be around 5.25% to 5.5%, officials remarked.

Post closing, the company’s net leverage ratio is expected in the high fours to low fives.

However, Endo believes that the financing combination provides the ability for it to rapidly delever back to the three to four times net debt to EBITDA range in the 12 to 18 months following the close of the transaction.

Other funds for the transaction will come from cash and an equity offering of around $1.5 billion to $2 billion.

Under the agreement, Par Pharmaceutical is being purchased from TPG in a transaction valued at $8.05 billion, including the assumption of debt.

The purchase price will consist of about 18 million shares of Endo equity and $6.5 billion cash consideration to Par shareholders.

Closing is expected in the second half of this year, subject to regulatory approval in the United States and certain other jurisdictions, as well as other customary conditions.

Endo is a Dublin, Ireland-based specialty pharmaceutical company. Par Pharmaceutical is a Woodcliff, N.J.-based developer, manufacturer and marketer of pharmaceuticals.

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