INC Research reduces term loan to $300 million with bond upsizing

By Sara Rosenberg

New York, July 7 - INC Research LLC downsized its term loan B to $300 million from $350 million as its senior notes offering was increased to $300 million from $250 million, according to a market source.

Pricing on the term loan B firmed at Libor plus 575 basis points with a 1.25% Libor floor and an original issue discount of 97, and 101 soft call protection for one year was added, sources said.

Most recent talk had been Libor plus 550 bps to 575 bps with a discount of 98, and earlier in syndication, price talk was lifted from Libor plus 475 bps to 500 bps and the discount widened from 99.

The company's now $375 million credit facility (Ba3/B+), down from $425 million, still includes a $75 million revolver.

Morgan Stanley & Co. Inc., ING Financial Markets LLC and RBC Capital Markets LLC are the lead banks on the deal.

Proceeds from the new debt, along with equity, will be used to fund the acquisition of Kendle International Inc. for $15.25 per share in cash. The total equity value is roughly $232 million.

Closing on the transaction is expected in the third quarter, subject to approval by Kendle's shareholders as well as satisfaction of customary conditions and regulatory approvals.

INC Research is a Raleigh, N.C.-based therapeutically focused contract research organization privately held by Avista Capital Partners and Ontario Teachers' Pension Plan. Kendle is a Cincinnati-based clinical research organization.

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