AmerisourceBergen sets pricing in tenders for $500 million 8 1/8% notes, $300 million 7¼% notes

By Jennifer Chiou

New York, Sept. 9 - AmerisourceBergen Corp. announced it set pricing for its previously announced cash tender offers for any and all of its $500 million of 8 1/8% senior notes due in 2008 and any and all of its $300 million of 7¼% senior notes due in 2012.

Assuming a Sept. 14 payment date, the company will pay $1,103.04 for each $1,000 principal amount of 8 1/8% notes plus accrued interest.

Also assuming a Sept. 14 payment date, the company will pay $1,166.37 for each $1,000 principal amount of 7¼% notes plus accrued interest.

Both payments include the consent payment of $30.00 per $1,000 principal amount of notes for those who tendered their holdings before the consent deadline at 5 p.m. ET on Sept. 8.

As of 5 p.m. ET on Sept. 8, more than 99.5% of the total principal amount of notes were tendered, resulting in the required consents to amend the notes' indentures, eliminating restrictive covenants.

The offer expires at 5 p.m. ET on Sept. 23.

For the 8 1/8% notes, AmerisourceBergen based pricing on the notes' redemption price on their first call date, discounted using the bid-side yield on the 4 1/8% Treasury due Aug. 15, 2008 plus 50 basis points. The bid-side yield of the 4 1/8% Treasury at 2 p.m. ET on Sept. 9 was 3.879%, which results in a reference yield of 4.379%.

For the 7¼% notes, the company based pricing on the redemption price of the notes on their first call date, discounted using the bid-side yield on the 4% Treasury due Nov. 15, 2012 plus 50 bps. The bid-side yield of the 4% Treasury at 2 p.m. ET on Sept. 9 was 4.007%, resulting in a 4.307% reference yield.

The offer is conditioned upon sufficient financing.

Lehman Brothers Inc. (800 438-3242 or call collect 212 528-7581) is the dealer manager and solicitation agent, and D.F. King & Co., Inc. is the information agent (800 859-8508 or call collect 212 269-5550).

Based in Valley Forge, Pa., AmerisourceBergen is a pharmaceutical services company.

On Sept. 8, AmerisourceBergen said it will sell $400 million of 5 5/8% senior notes due 2012 and $500 million 5 7/8% senior notes due 2015 to fund the tender offers.

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