Aceto plans $130 million facility led by JPMorgan and Wells Fargo

By Sara Rosenberg

New York, March 31 - Aceto Corp. has received a commitment for a $130 million senior secured credit facility, according to an 8-K recently filed with the Securities and Exchange Commission.

J.P. Morgan Securities LLC and Wells Fargo Securities LLC are the joint lead arrangers and bookrunners on the deal.

The facility consists of a $60 million five-year revolver and a $70 million term loan.

Initial pricing on the facility is expected at Libor plus 200 basis points, with the revolver having a 25 bps unused fee. The spread on the facility can range from Libor plus 150 bps to 225 bps and the revolver unused fee can range from 25 bps to 35 bps, based on senior secured net leverage.

Covenants include a total net leverage ratio, a senior secured net leverage ratio and a debt service coverage ratio.

Proceeds will be used to help fund the roughly $100 million acquisition of PACK Pharmaceuticals LLC, a marketer and distributor of generic prescription and over-the-counter pharmaceutical products.

Under the agreement, the purchase price includes an initial payment of about $80 million in cash and $5 million in Aceto stock and a three-year earn-out of up to $15 million in cash based on the achievement of certain performance-based targets.

Closing is expected in the second half of April, subject to customary closing conditions and the receipt of required regulatory approval.

Aceto is a Port Washington, N.Y.-based marketer, seller and distributor of products for human health, pharmaceutical ingredients and performance chemicals.

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