Royalty Pharma Announces Pricing of $6.0 Billion Senior Unsecured Notes
August 25 2020 - 8:00AM
Royalty Pharma plc announced today that it has priced an offering
of $6 billion senior unsecured notes, comprised of the following
tranches (collectively, the “Notes”):
- $1 billion aggregate principal amount of 0.75% Senior Notes due
2023;
- $1 billion aggregate principal amount of 1.20% Senior Notes due
2025;
- $1 billion aggregate principal amount of 1.75% Senior Notes due
2027;
- $1 billion aggregate principal amount of 2.20% Senior Notes due
2030;
- $1 billion aggregate principal amount of 3.30% Senior Notes due
2040; and
- $1 billion aggregate principal amount of 3.55% Senior Notes due
2050.
The Notes were issued in a private offering
exempt from registration in accordance with Rule 144A and
Regulation S under the Securities Act of 1933, as amended (the
“Securities Act”). The Notes will be guaranteed on a senior
unsecured basis by Royalty Pharma Holdings Ltd. The sale of the
Notes is expected to be completed on or about September 2, 2020,
subject to customary closing conditions.
Pablo Legorreta, Royalty Pharma’s Founder and
Chief Executive Officer, stated, “We are excited to announce our
inaugural bond offering as a publicly listed company. With this
transaction, we expect to lock in a weighted average coupon of
2.125% while more than doubling our weighted average maturity to
12.5 years. We will also have access to additional liquidity
through a $1.5 billion unsecured revolving credit facility, further
enhancing our financial flexibility. Our capital structure
following this offering will position us exceptionally well to
deliver on our growth objectives and to advance our role as a
leading funder of biopharma innovation.”
Royalty Pharma intends to use the net proceeds
from the Notes, together with available cash on hand, to repay its
existing Term Loan A and Term Loan B facilities and to pay fees and
expenses incurred in connection with the offering.
The Notes are being offered only to persons
reasonably believed to be qualified institutional buyers in
reliance upon Rule 144A under the Securities Act and, outside the
United States, only to non-U.S. persons pursuant to Regulation S
under the Securities Act. The Notes have not been registered under
the Securities Act or any state securities laws and may not be
offered or sold in the United States absent an effective
registration statement or an applicable exemption from registration
requirements under the Securities Act or any state securities
laws.
This press release does not constitute an offer
to sell or a solicitation of an offer to buy any securities, nor
does it constitute an offer, solicitation or sale in any
jurisdiction in which such offer, solicitation or sale is
unlawful.
Subject to the closing of the transaction,
interest payments on the Notes will be paid semi-annually, with the
first payment occurring in the quarter ending March 2021, compared
to the quarterly interest payment schedule of the existing Term
Loan A and B facilities. As a result of the refinancing, interest
expense on a cash basis in 2020 will be reduced from the date of
the closing of this transaction through the end of the year.
About Royalty Pharma
Founded in 1996, Royalty Pharma is the largest
buyer of biopharmaceutical royalties and a leading funder of
innovation across the biopharmaceutical industry, collaborating
with innovators from academic institutions, research hospitals and
not-for-profits through small and mid-cap biotechnology companies
to leading global pharmaceutical companies. Royalty Pharma has
assembled a portfolio of royalties which entitles it to payments
based directly on the top-line sales of many of the industry’s
leading therapies. Royalty Pharma funds innovation in the
biopharmaceutical industry both directly and indirectly - directly
when it partners with companies to co-fund late-stage clinical
trials and new product launches in exchange for future royalties,
and indirectly when it acquires existing royalties from the
original innovators. Royalty Pharma’s current portfolio includes
royalties on more than 45 commercial products, including AbbVie and
J&J’s Imbruvica, Astellas and Pfizer’s Xtandi, Biogen’s
Tysabri, Gilead’s HIV franchise, Merck’s Januvia, Novartis’
Promacta, and Vertex’s Kalydeco, Symdeko and Trikafta, and four
development-stage product candidates.
Forward-Looking Statements
This press release contains statements that
constitute “forward-looking statements” as that term is defined in
the United States Private Securities Litigation Reform Act of 1995,
including statements that express the company’s opinions,
expectations, beliefs, plans, objectives, assumptions or
projections regarding future events or future results, in contrast
with statements that reflect historical facts. Examples include
discussion of our strategies, financing plans, growth opportunities
and market growth. In some cases, you can identify such
forward-looking statements by terminology such as “anticipate,”
“intend,” “believe,” “estimate,” “plan,” “seek,” “project,”
“expect,” “may,” “will,” “would,” “could” or “should,” the negative
of these terms or similar expressions. Forward-looking statements
are based on management’s current beliefs and assumptions and on
information currently available to the company. However, these
forward-looking statements are not a guarantee of our performance,
and you should not place undue reliance on such statements.
Forward-looking statements are subject to many risks, uncertainties
and other variable circumstances, and other factors. Such risks and
uncertainties may cause the statements to be inaccurate and readers
are cautioned not to place undue reliance on such statements. Many
of these risks are outside of the company’s control and could cause
its actual results to differ materially from those it thought would
occur. The forward-looking statements included in this document are
made only as of the date hereof. The company does not undertake,
and specifically declines, any obligation to update any such
statements or to publicly announce the results of any revisions to
any such statements to reflect future events or developments,
except as required by law.
Royalty Pharma Investor Relations and
Communications:+1 (212) 883-0200ir@royaltypharma.com
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