Summary
McKesson Corporation (MCK) announced on March 4, 2007, through an 8-K filing, the completion of a significant debt offering. The company issued $500 million of 5.25% Notes due 2013 and $500 million of 5.70% Notes due 2017, totaling $1 billion in aggregate principal amount. The primary purpose of this offering was to refinance existing debt used to fund the recent acquisition of Per-Se Technologies, Inc. This strategic move aims to optimize McKesson's capital structure and reduce borrowing costs. The issuance of these notes, which are unsecured and unsubordinated, was made under the company's existing shelf registration statement.
Key Highlights
- 1McKesson Corporation issued $1 billion in aggregate principal amount of senior unsecured notes, split equally between 5.25% Notes due 2013 and 5.70% Notes due 2017.
- 2The offering was completed on February 28, 2007, with net proceeds expected to be approximately $990.7 million.
- 3Proceeds will be used to repay borrowings under an interim credit facility used to finance the acquisition of Per-Se Technologies, Inc.
- 4The notes are governed by an Indenture dated March 5, 2007, with The Bank of New York Trust Company, N.A. as trustee.
- 5The Indenture includes covenants limiting the company's ability to incur liens and enter into sale and leaseback transactions.
- 6A change of control provision requires McKesson to make an offer to purchase the notes at 101% of their principal amount plus accrued interest under specific downgrade conditions.
- 7The notes were offered under McKesson's effective shelf registration statement on Form S-3.