Summary
Thermo Fisher Scientific Inc. (TMO) announced on August 23, 2021, the successful completion of a public offering of $3.1 billion in aggregate principal amount of senior notes. This debt issuance comprises $700 million in 1.750% notes due 2028, $1.2 billion in 2.000% notes due 2031, and $1.2 billion in 2.800% notes due 2041. The primary purpose of this financing is to fund a portion of the cash consideration for the previously announced acquisition of PPD, Inc. The company anticipates utilizing the net proceeds, estimated at approximately $3.05 billion after expenses, to facilitate this significant acquisition. Pending the closing of the PPD acquisition, TMO may temporarily use a portion of these proceeds for general corporate purposes, including other acquisitions, debt refinancing, working capital, capital expenditures, or short-term investments.
Key Highlights
- 1Thermo Fisher Scientific issued $3.1 billion in senior notes across three tranches: 2028, 2031, and 2041 maturities.
- 2The issuance includes notes with coupon rates of 1.750% (2028), 2.000% (2031), and 2.800% (2041).
- 3The primary use of the net proceeds, approximately $3.05 billion, is to finance part of the cash consideration for the acquisition of PPD, Inc.
- 4The Notes are general unsecured obligations of the company, ranking equally with existing unsecured and unsubordinated debt.
- 5The indenture includes covenants restricting the incurrence of secured debt on principal properties and limits on sale and lease-back transactions.
- 6A change of control event coupled with a credit rating downgrade by two major rating agencies could trigger a mandatory repurchase offer at 101% of principal.
- 7Pending the PPD acquisition closing, proceeds may be used for general corporate purposes, including other acquisitions or debt repayment.