S&P puts Endo on watch

Standard & Poor's said it placed the BB+ corporate credit rating on Endo Pharmaceuticals Holdings Inc. on CreditWatch with negative implications, along with the BB+ rating on the $400 million of senior unsecured notes.

The action follows news that the company will be acquiring American Medical Systems Inc. for about $2.9 billion, or an estimated 15x of 2010 EBITDA, S&P said.

The acquisition, along with the refinancing of Endo's existing secured debt, will be funded with some $363 million in cash and $3.1 billion in debt financing.

The $2.7 billion of incremental debt will increase initial pro forma leverage to about 3.9x, the agency said.

The proposed acquisition will likely improve Endo's business risk profile through enhanced product and geographic diversity, S&P said, and a reduced dependence on patented products for revenue.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.