CD&R's acquisition of a SNY.US subsidiary is rumored to have received financing support from 22 banks

The Zhitong Finance App learned that according to reports, private equity giant Clayton Dubilier & Rice (CD&R) will acquire shares in SNY.US (SNY.US) consumer health division Opella at a price of about 15 billion euros (16.4 billion US dollars), and 22 banks, including Goldman Sachs Group and Citigroup, will finance the deal. People familiar with the matter revealed that it is expected that the lender will sign an agreement in the next few days to provide 8.65 billion euros (9.4 billion US dollars) of loan and bond financing in euros and dollars.

People familiar with the matter said that seven banks, including Barclays, BNP Paribas, Citigroup, Goldman Sachs Group, Morgan Stanley, and Société Générale, are expected to act as global coordinators.

The Federal Reserve's first rate cut in four years has raised hopes that the cost of debt will finally begin to fall, and banks are eager to refinance leveraged buyouts. This type of deal is one of the most profitable deals in the financial sector, and the Opella acquisition is one of the biggest deals in Europe since this year.

As many banks compete to participate, financing costs are expected to be reduced. Global coordinators often play a leading role in selling bonds to institutional investors and are therefore entitled to charge more. People familiar with the matter said that up to four of the seven banks may be responsible for euro term loans, while other global coordinators may be solely responsible for the sale of the remaining bonds.

According to previous media reports, various banks have signed financing commitments for 5.45 billion euro Class B term loans. The loan is denominated in euros and dollars. The target price for the euro portion is 350 basis points higher than the Euribor, and the target price for the dollar portion is 325 basis points higher than SOFR.

In addition, there is a bridge financing of 2 billion euros of high-yield bonds. The interest rate limit for Eurobonds is 7.5%, and the upper limit for US dollar bonds is 8.5%.

The bank will also provide a revolving credit line of around 1.2 billion euros.