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Warner Chilcott Term Loan Said to Rise in First Trade

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Aug. 18 (Bloomberg) -- Warner Chilcott Plc’s $1.02 million term loan B rose in its first trade, according to two people familiar with the transaction.

The 5.5-year debt, sold to investors at 99 cents on the dollar, first changed hands at 100.5 cents, said the people, who declined to be identified because the trades are private.

JPMorgan Chase & Co., Goldman Sachs Group Inc. and Bank of America Corp. arranged the debt, which has an interest rate of 4.25 percentage points more than the London interbank offered rate with a 2.25 percent floor. Libor is the rate that banks charge to lend to each other

Lenders also were offered a one-year soft call protection of 101 cents, the person said, meaning that the Ardee, Ireland-based maker of birth-control pills would have to pay a one cent premium over face value to refinance the term loan B in its first year.

As part of the transaction, Warner Chilcott also sold a 4-year, $480 million term loan A, which was bid at 99.25 cents this afternoon. A term loan A is sold primarily to banks, while a term loan B is mainly bought by non-bank lenders such as collateralized loan obligations, mutual funds and hedge funds.

Proceeds of the term loans and $750 million of unsecured notes will finance a $2.15 billion, or $8.50 a share, dividend, according to a July 30 company statement. Warner Chilcott said it expects to pay the dividend by Sept. 30.

Rochelle Fuhrmann, a spokeswoman for Warner Chilcott, didn’t return a phone call seeking comment.

To contact the reporters on this story: Krista Giovacco in New York at Kgiovacco1@bloomberg.net

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