Teva Pharmaceutical Industries Announces Early Results Of Debt Tender Offer, Pricing, Election Of Early Settlement And Increase In Maximum Amount And Priority 2 Notes Tender Cap

JERUSALEM--(BUSINESS WIRE)--Teva Pharmaceutical Industries Ltd. (NYSE: TEVA) announced today the early tender results, applicable Reference Yields and consideration payable in connection with its previously announced tender offers (the “Offers”) to purchase for cash a portion of the following series of notes issued by finance subsidiaries of Teva and guaranteed by Teva:

“We are pleased to be in a position to take advantage of our strong cash flow and the favorable interest rate environment to reduce our interest expense. We expect that these tender offers will have a net present value to us of approximately $170 million.”

  • 6.150% Senior Notes due 2036 issued by Teva Pharmaceutical Finance Company, LLC (the “Priority 1 Notes”);
  • 3.650% Senior Notes due 2021 issued by Teva Pharmaceutical Finance Company B.V. (“Teva BV”) and 3.650% Senior Notes due 2021 issued by Teva Pharmaceutical Finance IV B.V. (the “Priority 2 Notes”);
  • 2.950% Senior Notes due 2022 issued by Teva BV (the “Priority 3 Notes”); and
  • 2.400% Senior Notes due 2016 issued by Teva BV (the “Priority 4 Notes” and together with the Priority 1 Notes, the Priority 2 Notes and the Priority 3 Notes, the “Notes”).

Teva also announced that it has amended the terms of the Offers to increase the combined aggregate purchase price (exclusive of accrued and unpaid interest) of Notes it is purchasing in the Offers (the “Maximum Amount”) from $1 billion to $1.3 billion and the Tender Cap for the Priority 2 Notes to $550 million. All other terms of the Offers, as previously announced, remain unchanged. The Offers are being made pursuant to and are subject to the terms and conditions set forth in the Offer to Purchase dated February 12, 2015 (the “Offer to Purchase”) and related Letter of Transmittal.

Group Executive Vice President and Chief Financial Officer Eyal Desheh stated: “We are pleased to be in a position to take advantage of our strong cash flow and the favorable interest rate environment to reduce our interest expense. We expect that these tender offers will have a net present value to us of approximately $170 million.”

The respective principal amounts of all series of Notes that were validly tendered and not validly withdrawn at or prior to 5:00 p.m., New York City time, on February 26, 2015 (the “Early Tender Time”) are specified in the table below. The consideration to be paid in the Offers for each series of Notes has been determined in the manner described in the Offer to Purchase by reference to the applicable fixed spread over the yield to maturity of the applicable U.S. Treasury Reference Security specified in the table below (the “Total Consideration”). Holders who validly tendered and did not validly withdraw Notes at or prior to the Early Tender Time and whose Notes are accepted for purchase will receive the applicable Total Consideration, which includes an early tender premium of $30.00 per $1,000 principal amount of Notes accepted for purchase (the “Early Tender Premium”).

Title of
Notes

Issuer

CUSIP
Number

Principal
Amount
Outstanding

Principal
Amount
Tendered

Tender Cap

Acceptance
Priority
Level

U.S.
Treasury
Reference
Security

Reference
Yield

Fixed
Spread
(basis
points)

Total
Consideration
(per $1,000)(1)

6.150% Senior Notes due 2036 Teva Pharmaceutical Finance Company, LLC 88163VAD1 $986,828,000 $207,517,000 $197,400,000 1 3.125% due 8/15/2044 2.589% 150 bps $1,287.94
3.650% Senior Notes due 2021 Teva Pharmaceutical Finance Company B.V. 88165FAF9 $875,000,000 $477,635,000

$550,000,000(2)

2 1.250% due 1/31/2020 1.521% 110 bps $1,062.85

3.650% Senior Notes due 2021

Teva Pharmaceutical Finance IV B.V.

88166JAA1

$875,000,000

$523,194,000

2

1.250% due 1/31/2020

1.521%

110 bps

$1,062.85

2.950% Senior Notes due 2022 Teva Pharmaceutical Finance Company B.V. 88165FAG7 $1,300,000,000 $751,112,000 N/A 3 2.250% due 11/15/2024 2.010% 75

bps

$1,013.24
2.400% Senior Notes due 2016 Teva Pharmaceutical Finance Company B.V. 88165FAC6 $950,000,000 $526,971,000 N/A 4 0.375% due 10/31/2016 0.540% 25

bps

$1,027.17

___________________

(1) Based on the Reference Yield of the applicable U.S. Treasury Reference Security as of 2:00 p.m., New York City time, on February 26, 2015, as determined by the Dealer Managers. Total Consideration includes the Early Tender Premium of $30.00 per $1,000 principal amount of Notes accepted for purchase, but does not include accrued and unpaid interest.

(2) The $550,000,000 Tender Cap is an aggregate amount that applies to both the 3.650% Senior Notes due 2021 issued by Teva Pharmaceutical Finance Company B.V. and the 3.650% Senior Notes due 2021 issued by Teva Pharmaceutical Finance IV B.V.

Subject to the terms and conditions of the Offers, Teva expects that it will accept for purchase Notes validly tendered and not validly withdrawn at or prior to the Early Tender Time for a combined aggregate purchase price (exclusive of accrued and unpaid interest) equal to the Maximum Amount. The settlement for the Notes accepted by Teva in connection with the Early Tender Time is expected to take place on Friday, February 27, 2015 (the “Settlement Date”). The amount of each series of Notes that is to be purchased on the Settlement Date will be determined in accordance with the acceptance priority levels and the proration procedures described in the Offer to Purchase, subject in each case to the Maximum Amount and the applicable Tender Cap. It is expected that Priority 1 Notes will be subject to a proration factor of approximately 95 percent, Priority 2 Notes will be subject to a proration factor of approximately 55 percent and Priority 3 Notes will be subject to a proration factor of approximately 61 percent. No Priority 4 Notes will be purchased pursuant to the Offers. Payments for Notes purchased will include accrued and unpaid interest from and including the last interest payment date applicable to the relevant series of Notes up to, but not including, the Settlement Date.

The Withdrawal Deadline has passed and has not been extended. Notes tendered pursuant to the Offers may no longer be withdrawn, except as required by law.

The Offers will expire at 11:59 p.m., New York City time, on March 12, 2015, unless extended or earlier terminated (as it may be extended or earlier terminated, the “Expiration Time”). However, as Teva intends, subject to the terms and conditions of the Offers, to accept for purchase the Maximum Amount on the Settlement Date, further tenders of Notes prior to the Expiration Time will not be accepted for purchase.

Teva’s obligation to accept for payment and to pay for the Notes validly tendered in the Offers is subject to the satisfaction or waiver of certain conditions set out in the Offer to Purchase, but is not subject to a financing condition. Teva reserves the right, subject to applicable law and the terms of the Offers, to waive any and all conditions to the Offers or to otherwise amend, extend or terminate the Offers in any respect.

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