S&P rates Hikma notes BBB-

S&P said it assigned a BBB- issue rating to the proposed $500 million to $800 million of guaranteed notes to be issued by Hikma Finance USA LLC a wholly owned financing subsidiary of Hikma Pharmaceuticals plc, which S&P rates BBB-.

Hikma Pharmaceuticals, the parent of the group as well as other operating subsidiaries based in the U.S., Europe and the Middle East, will guarantee the notes.

“The BBB- issue ratings are in line with the issuer credit rating on Hikma, supported by the notes' pari passu ranking with the existing senior unsecured debt, which mainly includes a $1 billion committed revolving credit facility (RCF) maturing in December 2021 and other bank facilities,” S&P said in a press release.

The RCF is currently drawn by $550 million, mainly because Hikma used it to repay a $500 million bond on April 9. The group also drew $150 million on its IFC facility in April.

Proceeds will be used to repay the amount drawn on the revolver and for general corporate purposes. “The group operates at low leverage. As of year-end 2019, S&P Global Ratings-adjusted debt to EBITDA was 1x, reflecting a comfortable cash position of $441 million. The group does not face any other refinancing needs,” S&P said.

The outlook is stable.

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