Eurofins Successfully Prices EUR 300m New Hybrid Bond
23 April 2015 - 3:45PM
Business Wire
Regulatory News:
Eurofins (Paris:ERF):
Eurofins Scientific (ERF FP, unrated), the global leader in
bioanalytical testing, announces that it has successfully priced a
transaction to issue a new EUR 300m hybrid bond to further
strengthen its balance sheet and lengthen its stable financing
horizon at current favourable interest rate environment, in order
to be able to respond to compelling growth opportunities. The
transaction was well-received and swiftly completed, and the issue
was 2.5x times over-subscribed.
The new issue will bring Eurofins’ total hybrid capital to EUR
600m. Similar to the existing hybrid bond, the new series of bonds
has a perpetual maturity, and is accounted for as 100% equity
according to international financial reporting standards (IFRS). It
is callable at par by Eurofins on the 8th year (in April, 2023), in
contrast to the existing hybrid bond, which is callable in January
2020 (7 years from original issuance). The new series of bonds will
bear a lower fixed annual coupon of 4.875% for the first 8 years,
compared to the annual coupon of 7.00% until January 2020 for the
existing hybrid bond, thereby reducing the average cost of hybrid
capital to 5.4%1.
Eurofins intends to use the proceeds of the new issuance for
general corporate purposes, including funding of both organic and
external growth, as part of the Group’s mid-term development plan
with the objective to achieve revenues of EUR 2bn by 2017, as well
as to secure its longer-term leading position in the markets where
it is active. At the end of 2014, Eurofins had a net debt/EBITDA
ratio of 1.9x versus its debt covenant limit of 3.5x. Given the
equity accounting treatment of the instrument, the transaction has
a favourable impact on the Group’s debt ratios as the cash raised
lowers the net debt level, thereby further optimizing the balance
sheet and expanding headroom in its financing capacity.
Comment from Dr. Gilles Martin, Eurofins CEO: “The
successful issuance of our new hybrid instrument expands Eurofins
secure stable, long term financing, whilst allowing us to maintain
significant financial flexibility. Although we have decided to take
advantage of the current favourable interest rates in the market,
we remain committed to maintaining a strong balance sheet structure
and a disciplined approach to acquisitions. We believe that the
Group has the optimal funding mix to execute on its business plan
of growing organically and through selective acquisitions to reach
EUR 2bn in revenues by 2017, whilst delivering high returns on
capital and minimizing liquidity risk.”
BNP Paribas, HSBC and SG CIB acted as joint bookrunners for the
transaction. Settlement date is on the 29th of April, 2015, and the
first call date for the instrument is on the 29th of April,
2023.
The bonds will be listed from their issue date (29 April 2015)
on the regulated market of the Luxembourg stock exchange (ISIN
XS1224953882). The bonds are not registered under the US Securities
Act of 1933 as amended (the “Securities Act”), and may not be
offered or sold in (i) the United States (as such term is defined
in Regulation S under the Securities Act) unless registered under
the Securities Act or pursuant to an exemption from such
registration nor (ii) in any other jurisdiction where it is
unlawful to do so.
Notes for the editor:
Eurofins – a global leader in bio-analysis
Eurofins Scientific is the world leader in food and
pharmaceutical products testing. It is also number one in the world
in the field of environmental laboratory services and one of the
global market leaders in agroscience, genomics, discovery
pharmacology and central laboratory services.
With over 17,000 staff in more than 200 laboratories across 36
countries, Eurofins offers a portfolio of over 130,000 reliable
analytical methods for evaluating the safety, identity,
composition, authenticity, origin and purity of biological
substances and products. The Group provides its customers with
high-quality services, accurate results in time and expert advice
by its highly qualified staff.
Eurofins is committed to pursuing its dynamic growth strategy by
expanding both its technology portfolio and its geographic reach.
Through R&D and acquisitions, the Group draws on the latest
developments in the field of biotechnology and analytical chemistry
to offer its clients unique analytical solutions and the most
comprehensive range of testing methods.
As one of the most innovative and quality oriented international
players in its industry, Eurofins is ideally positioned to support
its clients’ increasingly stringent quality and safety standards
and the expanding demands of regulatory authorities around the
world.
The shares of Eurofins Scientific are listed on the Euronext
Paris Stock Exchange (ISIN FR0000038259, Reuters EUFI.PA, Bloomberg
ERF FP).
Important disclaimer:
This press release contains forward-looking statements and
estimates that involve risks and uncertainties. The forward-looking
statements and estimates contained herein represent the judgement
of Eurofins Scientific’ management as of the date of this release.
These forward-looking statements are not guarantees for future
performance, and the forward-looking events discussed in this
release may not occur. Eurofins Scientific disclaims any intent or
obligation to update any of these forward-looking statements and
estimates. All statements and estimates are made based on the data
available to the Company as of the date of publication, but no
guarantee can be made as to their validity.
1 The existing EUR 300m hybrid bond was issued at an average
yield of 6.0% (first EUR 150m tranche issued at 7.0%; second EUR
150m tranche issued at 5.0%). Therefore, the new EUR 300m hybrid
bond, which will be issued at 4.875%, will result in a blended
hybrid cost of capital of 5.4375%.
For more information please visit
http://www.eurofins.com
Eurofins Investor RelationsPhone: + 32 2 769
7383E-mail:ir@eurofins.com
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