Teva Pharmaceutical Industries Limited (NASDAQ: TEVA) is not exactly one of the first companies we would think of as offering a bond issue, and it might normally lead us to think that Teva was on the verge of making another acquisition. The company is raising debt capital but it does not seem to be signaling any imminent deal is coming.
The company’s finance unit is selling some $750 million with fixed and floating rates. The floating tranche is said to be $500 million expected at about 50 basis points over LIBOR and the $250 million fixed piece had price talk of 70 to 75 basis points above Treasuries.
This appears to be debt that can be used to refinance other debt coming due without tapping into the cash coffers. The official use is “for general corporate purposes.”
Teva was already carrying $4.331 billion in long-term debt and carried more than $2 billion between ‘other liabilities’ and deferred long-term liability charges. The company’s market cap is now back down to $42.7 billion now that shares are this far off its 52-week high. With shares down 1.9% at $47.53 today, Teva’s 52-week trading range is $46.99 to $64.95
JON C. OGG
