Healthcare Royalty sets Tuesday investor call for $750 million eight-year notes offer

By Paul A. Harris

Portland, Ore., July 12 – Healthcare Royalty, Inc. plans to kick off a $750 million offering of eight-year unsecured notes on a conference call scheduled to get underway at 10:30 a.m. ET on Tuesday, according to a syndicate source.

Initial talk is in the high 4% area.

The Rule 144A and Regulation S deal is expected to price Friday.

Credit Suisse Securities (USA) LLC is the left lead bookrunner. Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, Truist, BMO Capital Markets Corp., Stifel, Nicolaus & Co. Inc., Raymond James & Associates and SVB Leerink are the joint bookrunners.

The notes become callable after three years at par plus 50% of the coupon. They feature a three-year 40% equity clawback and a 101% poison put.

The issuing entity will be HCRX Investments HoldCo, LP, a newly formed, wholly owned operating subsidiary of Healthcare Royalty.

The New York-based midmarket royalty acquisition company plans to use some or all of the proceeds to repurchase certain limited partnership units held by existing investors in a limited partnership formed to serve as the principal holding company for HCR’s operating subsidiaries. The proceeds may be escrowed pending completion of Healthcare Royalty’s initial public offering. Any remaining proceeds would be used for general corporate purposes.

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