ICON slashes two-part secured notes offering to $500 million, upsizes loan; pricing Wednesday

By Paul A. Harris

Portland, Ore., June 15 – ICON plc massively downsized its two-part offering of senior secured notes (Ba1/BB+) to $500 million from $2.015 billion, shifting proceeds to its concurrent term loan, according to market sources.

The deal includes a tranche of five-year notes, callable after two years at par plus 50% of the coupon, with initial guidance in the low 3% area.

The offering also includes a tranche of seven-year notes, callable after three years at par plus 50% of the coupon, with initial guidance in the high 3% area.

Dealers intend to circulate official talk on Wednesday morning, and the Rule 144A and Regulation S for life notes are scheduled to price later that day.

Tranche sizes remain to be determined. Previous tranching sized the five-year notes at $500 million and had the seven-year notes sized at $1.515 billion.

Citigroup is the lead left bookrunner. Morgan Stanley is the joint bookrunner. HSBC, JPMorgan and Santander are the joint lead managers.

With the downsizing of the notes, the size of the loan increased to $5.515 billion from $4 billion.

Proceeds from the debt offerings will be used to fund the acquisition of PRA Health Services Inc. and refinance ICON’s and PRA’s debt.

The issuing entities will be Indigo Merger Sub, Inc., which will be merged with and into PRA Health Services, upon closing. PRA will be the continuing issuer.

The company is a Dublin, Ireland-based provider of outsourced drug and device development and commercialization services.

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