Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA) is raising cash to fund its Allergan acquisition. The company has announced two offerings totaling approximately $6.75 billion, consisting of approximately $3.375 billion of its American Depositary Shares (ADSs), each representing one Teva ordinary share, and approximately $3.375 billion of its Mandatory Convertible Preferred Shares. The company says that the final amounts of these securities will be determined on the basis of market and other conditions.
Teva says that it intends to use the net proceeds from these offerings towards the cash portion of the purchase price for its previously announced acquisition of Allergan plc’s worldwide generic pharmaceuticals business (Actavis Generics), and to pay related fees and expenses for the pending acquisition of Rimsa "or otherwise for general corporate purposes."
Teva announced the acquisition of Actavis Generics for $40.5 billion in cash and shares in July this year.
Teva makes clear that these offerings are separate public offerings made by means of separate prospectus supplements and are not contingent on each other, or upon the consummation of the Actavis Generics or Rimsa acquisitions. "If for any reason the acquisitions do not close, Teva expects to use the net proceeds from these offerings for general corporate purposes. Teva intends to grant the underwriters in each offering the option to purchase up to an additional 10% of the ADSs and up to an additional 10% of the Mandatory Convertible Preferred Shares, in each case, solely to cover overallotments, if any," the company's announcement says.
Barclays, BofA Merrill Lynch, Citigroup, Morgan Stanley, BNP Paribas, Credit Suisse, HSBC, Mizuho Securities, RBC Capital Markets and SMBC Nikko are acting as the joint book-running managers for the offerings.
Published by Globes [online], Israel business news - www.globes-online.com - on November 30, 2015
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