Warner Chilcott sets IPO size at 70.6 million shares, price range at $17 to $19 each

By Ronda Fears

Memphis, Sept. 5 - Warner Chilcott Ltd. set a price range on its initial public offering of class A shares at $17 to $19, boosting estimated proceeds to $1.48 billion from a prior estimate of $1 billion. The IPO, via bookrunner Goldman, Sachs & Co., is projected to net $1.2 billion.

Credit Suisse, JPMorgan and Morgan Stanley are joint leads. Co-managers are Deutsche Bank Securities, Bear Stearns & Co. Inc., Merrill Lynch & Co., Wachovia Securities and UBS Investment Bank.

There is a greenshoe for 7.06 million shares available.

Proceeds are earmarked to reduce the company's senior secured credit facility by $470 million, to repurchase $228 million of outstanding 8¾% senior subordinated notes due 2015 and $463 million of preferred shares and for general corporate purposes.

Rockaway, N.J.-based Warner Chilcott specializes in women's health care and dermatology products in the United States, especially oral hormonal contraceptive and hormone therapy, including the April launch of the contraceptive Loestrin 24 Fe and psoriasis treatment Taclonex.

Also, in September, the company plans to launch Ovcon 35 Fe, the first chewable oral contraceptive to receive Food and Drug Administration approval.

In addition to internal product development efforts, the company said it also selectively pursues partnerships, in-licensing opportunities and acquisitions, such as with the Danish company LEO Pharma A/S in 2005 which gives Warner Chilcott a right of first refusal for the U.S. sales and marketing rights to all dermatology product candidates in LEO Pharma's development pipeline through 2010.

LEO Pharma, focused on dermatology, generated revenue of $810 million in 2005. LEO Pharma developed Taclonex and has a portfolio in various phases of product development.

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