8-KMaterial AgreementsFinancial EventsRegulation FD+2

Cencora, Inc. 8-K Report, Material Agreement (Dec 5, 2017)

Filed December 5, 2017For Securities:COR

Summary

Cencora, Inc. (formerly AmerisourceBergen Corporation) announced on December 4, 2017, the successful closing of a significant debt offering, raising a total of $1.25 billion. The company issued $750 million in 3.45% Senior Notes due December 15, 2027, and $500 million in 4.30% Senior Notes due December 15, 2047. These notes are unsecured and rank equally with other unsecured, unsubordinated debt, but are structurally subordinated to subsidiary debt. The proceeds from this offering are likely intended to support the company's strategic initiatives and overall capital structure, although the specific use of proceeds is not detailed in this filing. This debt issuance is notable for its long maturities and fixed interest rates, providing Cencora with a stable, long-term source of capital. The indenture agreements include provisions for change of control offers and specific redemption clauses. Notably, there's a condition requiring redemption of the 2047 Notes if the acquisition of H.D. Smith is not completed by May 20, 2018, or if the acquisition agreement is terminated. Investors should monitor the progress of this acquisition as it has implications for the company's debt obligations.

Key Highlights

  • 1Cencora (formerly AmerisourceBergen) closed a debt offering raising $1.25 billion.
  • 2Issued $750 million in 3.45% Senior Notes due 2027.
  • 3Issued $500 million in 4.30% Senior Notes due 2047.
  • 4Notes are unsecured and rank equally with existing unsecured, unsubordinated debt.
  • 5Notes are structurally subordinated to the debt of subsidiaries.
  • 6Includes provisions for a 101% change of control offer to purchase notes.
  • 72047 Notes subject to redemption if H.D. Smith acquisition is not completed by May 20, 2018.

Frequently Asked Questions

This 8-K filing announces the completion of Cencora's debt offering, detailing the issuance of $750 million in 3.45% Senior Notes due 2027 and $500 million in 4.30% Senior Notes due 2047.

The 2027 Notes bear a 3.45% interest rate and mature on December 15, 2027. The 2047 Notes bear a 4.30% interest rate and mature on December 15, 2047. Both pay interest semi-annually and are unsecured obligations of the company.

The 2047 Notes will be redeemed at 101% of their principal amount if the acquisition of H.D. Smith is not completed by May 20, 2018, or if the related acquisition agreement is terminated without consummation. This highlights a contingent financial obligation tied to the acquisition's success.

The Notes are unsecured and unsubordinated, ranking equally with the company's other unsecured and unsubordinated debt. However, they are structurally subordinated to any debt or liabilities of Cencora's subsidiaries.