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Deutsche Bank Agents $600MM Financing to Support Mallinckrodt Acquisition of Sucampo

February 14, 2018, 07:15 AM
Filed Under: Pharmaceuticals

Mallinckrodt has entered into a $600 million senior secured term loan facility to help finance its merger with Sucampo Pharmaceuticals, Inc., according to a regulatory filing.

The New Term Loan is an incremental facility under the Credit Agreement, dated as of March 19, 2014, among Mallinckrodt, MIFSA, MCB, the lenders party thereto from time to time and Deutsche Bank AG New York, as administrative agent. The New Term Loan is governed by the Credit Agreement and an Incremental Assumption Agreement No. 4 (the IAA), dated as of February 13, 2018, among Mallinckrodt, MIFSA, MCB, the other subsidiaries of Mallinckrodt party thereto, the lenders party thereto and Deutsche Bank AG New York Branch, as administrative agent.

"We are pleased to complete our acquisition of Sucampo, bringing near-term net sales and earnings accretion while bolstering our pipeline," said Mark Trudeau, Chief Executive Officer and President of Mallinckrodt. "We are also pleased to welcome members of the Sucampo team into Mallinckrodt, and look forward to continuing their strong efforts to bring much-needed therapies to patients suffering from rare diseases. This is an important next step towards our vision of becoming an innovation-driven specialty pharmaceutical growth company focused on improving outcomes for patients with severe and critical conditions."

The New Term Loan bears interest, at the option of the borrowers thereunder, at a rate equal to adjusted LIBOR, subject to a floor of 0.75%, plus a spread equal to 3.00%, or an alternate base rate, subject to a floor of 1.75%, plus a spread equal to 2.00%. Interest on the New Term Loan is payable at the end of each interest period, but in no event less frequently than quarterly.

The New Term Loan has similar terms to the term loans incurred under the Credit Agreement on February 28, 2017 (the “2017 Term Loans”) (other than with respect to the maturity date, the applicable interest rate, and prepayment premiums in respect of certain voluntary prepayments). The New Term Loan will be guaranteed by, and secured by the assets of, Mallinckrodt and the same subsidiaries of Mallinckrodt which guarantee the 2017 Term Loans. The New Term Loan matures on February 24, 2025. Amounts outstanding under the New Term Loan may be prepaid at any time, subject, under certain circumstances, to a 1.00% prepayment premium.

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