Item 7.01. Regulation FD Disclosure.
On May 12, 2020, AmerisourceBergen Corporation (the "Company" or
"AmerisourceBergen") issued a news release announcing that it priced $500
million aggregate principal amount of the Company's 2.800% Senior Notes due May
15, 2030 (the "Notes") in an underwritten registered public offering. The news
release is being furnished with this Current Report as Exhibit 99.1 and is
incorporated herein by reference.
Item 8.01. Other Events.
On May 12, 2020, the Company entered into an Underwriting Agreement (the
"Underwriting Agreement"), by and among the Company and BofA Securities, Inc.,
MUFG Securities Americas Inc., and U.S. Bancorp Investments, Inc. on behalf of
themselves and as representatives of the several underwriters named therein (the
"Underwriters"). The Underwriting Agreement provides for the issuance and sale
by the Company, and the purchase by the Underwriters, of the Notes. The Notes
will be senior unsecured obligations of the Company. The Underwriting Agreement
contains representations, warranties, conditions and covenants of the parties
thereto and provides for indemnification by each of the Company and the
Underwriters against certain liabilities and contribution provisions in respect
of those liabilities. The Company expects to consummate the sale of the Notes to
the Underwriters, which is subject to the closing conditions specified in the
Underwriting Agreement, on May 19, 2020.
The offer and sale of the Notes have been registered under the Securities Act of
1933, as amended, pursuant to the Company's shelf registration statement on Form
S-3 (Registration Statement No. 333-228489) (the "Shelf Registration
Statement"), filed with the Securities and Exchange Commission on November 20,
2018.
If the sale of the Notes is consummated pursuant to the terms set forth in the
Underwriting Agreement, the Company estimates that it will receive net proceeds
of approximately $493.8 million (after deducting underwriting discounts and
offering expenses) from the sale of the Notes. The Company intends to use the
net proceeds to redeem all of its 3.500% Senior Notes due November 15, 2021 and
for general corporate purposes. Pending application of the net proceeds from the
sale of the Notes for the foregoing purposes, the Company expects to invest such
proceeds in high-quality, short-term debt securities (although it is not
required to do so by the terms of the Notes).
Certain of the underwriters and their affiliates have in the past provided, and
may in the future provide, investment banking, commercial banking, derivative
transactions and financial advisory services to the Company and its affiliates
in the ordinary course of business for which they have received and may continue
to receive customary fees and commissions. Specifically, BofASecurities, Inc.,
MUFG Securities Americas Inc. and U.S. Bancorp Investments, Inc. or their
affiliates and certain other underwriters have served as underwriters in
connection with past senior note offerings by the Company and may serve similar
roles in future securities offerings by the Company. Additionally, the
underwriters or their affiliates serve various roles in the Company's
multi-currency revolving credit facility: BofA Securities, Inc. serves as a
joint lead arranger and joint bookrunner and Bank of America, N.A., an affiliate
of BofA Securities, Inc., serves as a syndication agent and a lender; and MUFG
Bank, Ltd., an affiliate of MUFG Securities Americas Inc., and U.S. Bank
National Association, an affiliate of U.S. Bancorp Investments, Inc., serve as
documentation agents and lenders. As of March 31, 2020, there were no borrowings
outstanding under the Company's multi-currency revolving credit facility. In
addition, MUFG Bank, Ltd. serves as administrator for the Company's receivables
securitization facility. As of March 31, 2020, the Company's subsidiary,
Amerisource Receivables Financial Corporation, had an aggregate principal amount
of $350 million outstanding under the receivables securitization facility. U.S.
Bancorp Investments, Inc. is an affiliate of the trustee. Lastly, certain of the
underwriters or their affiliates also serve as lenders, agents and in other
capacities under the Company's credit facilities.
The foregoing is a brief description of certain terms of the Underwriting
Agreement and, by its nature, is incomplete. It is qualified in its entirety by
the text of the Underwriting Agreement filed as Exhibit 1.1 to this Current
Report and incorporated herein by reference. The Underwriting Agreement is also
filed with reference to, and is hereby made an exhibit to, the Shelf
Registration Statement.
Cautionary Note Regarding Forward-Looking Statements
Certain of the statements contained in this Current Report on Form 8-K are
"forward-looking statements" within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Words such
as "expect," "likely," "outlook," "forecast," "would," "could," "should," "can,"
"project," "intend," "plan," "continue," "sustain," "synergy," "on track,"
"believe," "seek," "estimate," "anticipate," "may," "possible," "assume,"
variations of such words, and similar expressions are intended to identify such
forward-looking statements. These statements are based on management's current
expectations and are subject to uncertainty and changes in circumstances and
speak only as of the date hereof. These statements are not guarantees of future
performance and are based on assumptions and estimates that could prove
incorrect or could cause actual results to vary materially from those indicated.
Among the factors that could cause actual results to differ materially from
those projected, anticipated, or implied are the following: unfavorable trends
in brand and generic pharmaceutical pricing, including in rate or frequency of
price inflation or deflation; competition and industry consolidation of both
customers and suppliers resulting in increasing pressure to reduce prices for
our products and services; changes in the United States healthcare and
regulatory environment, including changes that could impact prescription drug
reimbursement under Medicare and Medicaid; increasing governmental regulations
regarding the pharmaceutical supply channel and pharmaceutical compounding;
declining reimbursement rates for pharmaceuticals; continued federal and state
government enforcement initiatives to detect and prevent suspicious orders of
controlled substances and the diversion of controlled substances; continued
prosecution or suit by federal, state and other governmental entities of alleged
violations of laws and regulations regarding controlled substances, including
due to failure to achieve a global resolution of the multi-district opioid
litigation and other related state court litigation, and any related disputes,
including shareholder derivative lawsuits; increased federal scrutiny and
litigation, including qui tam litigation, for alleged violations of laws and
regulations governing the marketing, sale, purchase and/or dispensing of
pharmaceutical products or services, and associated reserves and costs; failure
to comply with the Corporate Integrity Agreement; material adverse resolution of
pending legal proceedings; the retention of key customer or supplier
relationships under less favorable economics or the adverse resolution of any
contract or other dispute with customers or suppliers; changes to customer or
supplier payment terms, including as a result of the COVID-19 impact on such
payment terms; risks associated with the strategic, long-term relationship
between Walgreens Boots Alliance, Inc. and the Company, including principally
with respect to the pharmaceutical distribution agreement and/or the global
generic purchasing services arrangement; changes in tax laws or legislative
initiatives that could adversely affect the Company's tax positions and/or the
Company's tax liabilities or adverse resolution of challenges to the Company's
tax positions; regulatory or enforcement action in connection with our former
compounded sterile preparations (CSP) business or the related consent decree;
managing foreign expansion, including non-compliance with the U.S. Foreign
Corrupt Practices Act, anti-bribery laws, economic sanctions and import laws and
regulations; financial market volatility and disruption; the loss, bankruptcy or
insolvency of a major supplier, including as a result of COVID-19; substantial
defaults in payment, material reduction in purchases by or the loss, bankruptcy
or insolvency of a major customer, including as a result of COVID-19; financial
and other impacts of COVID-19 on our operations or business continuity; changes
to the customer or supplier mix; malfunction, failure or breach of sophisticated
information systems to operate as designed; risks generally associated with data
privacy regulation and the international transfer of personal data; natural
disasters or other unexpected events that affect the Company's operations; the
impairment of goodwill or other intangible assets (including any additional
impairments with respect to foreign operations), resulting in a charge to
earnings; the acquisition of businesses that do not perform as expected, or that
are difficult to integrate or control, or the inability to capture all of the
anticipated synergies related thereto or to capture the anticipated synergies
within the expected time period; the Company's ability to manage and complete
divestitures; the disruption of the Company's cash flow and ability to return
value to its stockholders in accordance with its past practices; interest rate
and foreign currency exchange rate fluctuations; declining economic conditions
in the United States and abroad; and other economic, business, competitive,
legal, tax, regulatory and/or operational factors affecting the Company's
business generally. Certain additional factors that management believes could
cause actual outcomes and results to differ materially from those described in
forward-looking statements are set forth (i) in Item 1A (Risk Factors), in the
Company's Annual Report on Form 10-K for the fiscal year ended September 30,
2019 and elsewhere in that report, (ii) in Item 1A (Risk Factors), in the
Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 and
elsewhere in that report and (iii) in other reports filed by the Company
pursuant to the Securities Exchange Act. The Company undertakes no obligation to
publicly update or revise any forward-looking statements, except as required by
the federal securities laws.
Item 9.01. Financial Statements and Exhibits.
Exhibit
Number Description
Underwriting Agreement for 2.800% Senior Notes due 2030, dated as of
1.1 May 12, 2020.
99.1 News release of AmerisourceBergen Corporation, dated May 12, 2020.
104 Cover Page Interactive Data File (formatted as inline XBRL)
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