Thermo Fisher Scientific Inc., the maker of medical-laboratory equipment acquiring Life Technologies Corp. for $13.6 billion, issued $3.2 billion of bonds in four parts to help fund the purchase.
The company sold $900 million each of 1.3 percent, three- year notes to yield 75 basis points more than similar-maturity Treasuries and 2.4 percent, five-year bonds to pay 100 basis points more than benchmarks, according to data compiled by Bloomberg. It also sold $1 billion of 4.15 percent, 10-year debt at a spread of 135 basis points and $400 million of 5.3 percent, 30-year securities at 140.
The bonds are expected to be rated Baa3, the lowest level of investment grade, by Moody’s Investors Service, Bloomberg data show. Fitch Ratings cut its grade today one level to BBB, one level above Moody’s, because of the $10.8 billion of additional debt from the Life Technologies transaction.
The new securities will be redeemed at 101 cents on the dollar if Thermo Fisher doesn’t close the acquisition by July 14, the company said in a filing today. Life Technologies, based in Carlsbad, California, makes laboratory equipment that helps to map DNA, information used to diagnose disease, identify risks of certain conditions or more efficiently target medicines.
It last issued debt in August 2012, raising $1.3 billion in two parts, Bloomberg data show. Barclays Plc, JPMorgan Chase & Co., and Royal Bank of Scotland Group Plc managed the offering for the Waltham, Massachusetts-based company.