Jazz Pharmaceuticals sets talk on $575 million of loans with launch

By Sara Rosenberg

New York, Jan. 7 - Jazz Pharmaceuticals Inc. released price talk on its $575 million in incremental bank debt in connection with its Tuesday bank meeting, according to a market source.

The fungible $175 million incremental revolver due June 12, 2017 is talked at Libor plus 250 basis points with no Libor floor, and the fungible $400 million incremental term loan due June 12, 2018 is talked at Libor plus 275 bps with a 0.75% Libor floor and an original issue discount of 991/2, the source said.

The upfront fee on the revolver is 30 bps for a $20 million commitment and 20 bps for a commitment less than $20 million.

Included in the incremental term loan is 101 soft call protection for six months, and the existing term loan will get that call protection as well, the source continued.

The debt has a maximum secured leverage covenant of 3 times, net of $150 million of restricted cash.

Barclays, J.P. Morgan Securities LLC, Bank of America Merrill Lynch, Citigroup Global Markets Inc. and Morgan Stanley Senior Funding Inc. are the joint lead arrangers and bookrunners on the deal.

Commitments are due on Jan. 17, the source added.

Proceeds, along with cash on hand, will be used fund the acquisition of Gentium SpA for $57.00 per share in a transaction that is valued at about $1 billion.

Closing is expected this quarter, subject to at least 66.67% of the fully diluted number of ordinary shares and ADS of Gentium being tendered in the offer, and customary conditions.

Jazz is a Dublin, Ireland-based specialty biopharmaceutical company that identifies, develops and commercializes products that address unmet medical needs. Gentium is a Como, Italy-based biopharmaceutical company focused on the development and manufacturing of therapies to treat and prevent a variety of rare diseases and conditions.

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