PPD Sets Nov. 8 Lender Meeting for $1.325 Buyout Financing

Pharmaceutical Product Development Inc. (PPDI), a provider of drug discovery and development services, will host a lender meeting on Nov. 8 in New York to discuss a $1.325 billion term loan to finance its buyout by Carlyle Group and Hellman & Friedman LLC, according to a person with knowledge of the transaction.

The seven-year debt will pay 5.5 percentage points more than the London interbank offered rate, said the person, who declined to be identified because the terms are private. Libor, a rate banks charge to lend to each other, will have a 1.25 percent floor.

The company is proposing to sell the loan at 97 cents on the dollar, the person said, reducing proceeds for the company and boosting the yield to investors.

Lenders are being offered one-year soft-call protection of 101 cents, meaning the Wilmington, North Carolina-based company would have to pay 1 cent more than face value to refinance the debt during the first year, the person said.

Credit Suisse Group AG, the bank arranging the financing, is asking lenders to submit commitments by Nov. 16.

Carlyle and Hellman & Friedman agreed to buy Pharmaceutical Product Development in a deal valued at $3.9 billion. The buyout firms are taking the company private for $33.25 a share, according to an Oct. 3 company statement.

Ned Glascock, a spokesman for Pharmaceutical Product Development, declined to comment.

In a revolving credit facility, money can be borrowed again once it’s repaid; in a term loan, it can’t.

To contact the reporter on this story: Michael Amato in New York at mamato3@bloomberg.net

To contact the editor responsible for this story: Faris Khan at fkhan33@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.