Fortrea starts roadshow for $570 million seven-year secured notes; initial talk high-7% to 8 area

By Paul A. Harris

Portland, Ore., June 8 – Fortrea Holdings Inc. began a roadshow on Thursday for a $570 million offering of senior secured notes due 2030 (Ba3/BB/BB+), according to market sources.

The Rule 144A for life and Regulation S deal, which was set to kick off on a Thursday morning conference call with investors, has initial guidance in the high-7% to 8% area and is expected to price on Monday.

The seven-year notes become callable after three years at par plus 50% of the coupon. They feature a 40% equity clawback prior to the first call date and have a 101% poison put.

Barclays is the left bookrunner. Goldman Sachs & Co. LLC, BofA Securities Inc., Citigroup Global Markets Inc., J.P. Morgan Securities LLC, MUFG Securities Americas Inc., PNC Capital Markets LLC and Wells Fargo Securities LLC are the joint bookrunners.

Citizens Capital Markets Inc., TD Securities (USA) LLC, U.S. Bancorp Investments Inc., CIT Capital Securities LLC and Credit Agricole CIB are the co-managers.

Proceeds plus a $1.52 billion credit facility will be used to fund the cash portion of the spinoff of Fortrea from Laboratory Corp. of America (LabCorp). Fortrea will make an expected $1.605 billion cash distribution to LabCorp as partial consideration for the assets to be contributed in the spinoff.

Fortrea is a Durham, N.C.-based contract research organization providing comprehensive phase I through IV biopharmaceutical product and medical devices services.

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