Merck Places U.S. Bond

Merck Places U.S. Bond


Merck successfully placed a U.S. bond via its U.S. subsidiary EMD Finance LLC. The oversubscribed placement is an important element to finance the proposed acquisition of Sigma-Aldrich for US$ 17 billion.

A total of five tranches were placed, comprising floating rate and fixed rate notes. The floating rate notes have a maturity of two years (US$ 250 million with a 0.35 % spread over 3-month U.S. dollar LIBOR). The fixed rate notes have a maturity of three years (US$ 400 million with a coupon of 1.70 %), five years (US$ 750 million with a coupon of 2.40 %), seven years (US$ 1.0 billion for 2.95 %), and ten years (US$ 1.6 billion for 3.25 %).

Merck says the bond achieved a well-diversified distribution among a wide range of institutional investors such as fund managers, insurance companies, pension funds, and banks. Bookrunners of the transaction were Merck’s relationship banks. In December 2014, Merck had already successfully issued a euro hybrid bond amounting to € 1.5 billion. Merck is rated A flat (negative outlook) by Standard & Poor’s and Baa1 (negative outlook) by Moody’s.

Picture: Marcus Kuhnert, Chief Financial Officer of Merck © Merck


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