8-KMaterial AgreementsOther EventsExhibits & Filings

BIOGEN INC. 8-K Report, Material Agreement (May 30, 2007)

Filed May 30, 2007For Securities:BIIB

Summary

Biogen Idec Inc. (BIIB) announced on May 29, 2007, a significant capital return initiative through a modified "Dutch Auction" tender offer to repurchase up to approximately $3 billion of its common stock. This offer, which represents about 16% of outstanding shares, allows shareholders to tender shares at prices between $47.00 and $53.00, commencing May 30, 2007, and expiring on June 26, 2007. The company plans to fund this substantial share repurchase with a combination of existing cash and new debt financing. To support the tender offer, Biogen Idec has secured commitments for a $1.5 billion term loan and a $400 million revolving credit facility. The term loan, available for a single draw and maturing 364 days after draw, is specifically earmarked to finance a portion of the tender offer. The revolving credit facility will be available post-repurchase for general corporate purposes and working capital needs. The availability of these credit facilities is contingent upon the successful completion of a minimum $1.5 billion share purchase in the tender offer and other customary conditions.

Key Highlights

  • 1Biogen Idec is launching a $3 billion modified "Dutch Auction" tender offer to repurchase approximately 16% of its outstanding common stock.
  • 2The tender offer period runs from May 30, 2007, to June 26, 2007, with shareholders able to tender shares at prices between $47.00 and $53.00.
  • 3The $3 billion repurchase will be funded by up to $1.5 billion in cash and up to $1.5 billion in debt financing.
  • 4Biogen Idec has secured a commitment for a $1.5 billion term loan to help finance the tender offer.
  • 5A $400 million revolving credit facility has also been committed, intended for working capital and general corporate purposes after the share repurchase.
  • 6Both debt facilities are conditioned on the successful purchase of at least $1.5 billion in shares through the tender offer.
  • 7The company expects to maintain a maximum leverage ratio and potentially a minimum interest coverage ratio under the terms of the new credit facilities.

Frequently Asked Questions

This 8-K filing announces Biogen Idec's entry into material definitive agreements related to new debt financing and discloses details about a significant $3 billion "Dutch Auction" tender offer to repurchase its common stock.

The repurchase is planned to be funded through a combination of approximately $1.5 billion in cash and up to $1.5 billion in debt financing, specifically a new term loan.

Biogen Idec has committed to a $1.5 billion term loan, available for a single draw and maturing 364 days after the draw, primarily to fund the tender offer. Additionally, a $400 million revolving credit facility is committed for general corporate purposes post-repurchase, with borrowing available until the fifth anniversary of the share purchase.

The lenders' commitment to provide the term loan and revolving credit facility is contingent upon Biogen Idec consummating the purchase of at least $1.5 billion in shares through the tender offer, as well as other standard conditions and the negotiation of final loan documents.