OSAKA - Takeda Pharmaceutical Company Limited (TSE: 4502/NYSE: TAK) ('Takeda') today announced that it filed with the Director of the Kanto Local Finance Bureau a shelf registration statement for the issuance of up to 500 billion Japanese yen aggregate principal amount of bonds and an amended shelf registration statement in connection with its potential public offering of hybrid bonds (subordinated bonds) (the 'Hybrid Bonds').
Although Takeda has previously entered into the Subordinated Syndicated Loan Agreement (the 'Subordinated Loan Agreement') with total commitments of 500 billion Japanese yen to be used to refinance the indebtedness incurred pursuant to SSTL, Takeda plans to issue a maximum aggregate principal amount of 500 billion Japanese yen of Hybrid Bonds for the purpose of substituting all or a part of the amounts available under the Subordinated Loan Agreement, none of which has been drawn at this stage.
Purpose and Background to the Hybrid Bond Issue
As announced in 'Notice regarding the Acquisition of the Entire Issued and To Be Issued Share of Shire plc' by Takeda Pharmaceutical Company Limited' on January 8, 2019, Takeda acquired all of the shares of Shire plc ('Shire') and completed its acquisition of Shire as of January 8, 2019.
In the process of this acquisition, as announced in 'Takeda Announces Execution of Senior Short Term Loan Facility Agreement and Subordinated Syndicated Loan Agreement and Second Amendment to Bridge Credit Agreement in Connection with Proposed Acquisition of Shire plc' on October 26, 2018. Takeda entered into the SSTL for an aggregate principal amount of up to 500 billion Japanese yen. The SSTL financed a portion of the funds necessary for the acquisition of Shire. Takeda has also entered into the Subordinated Loan Agreement for an aggregate principal amount of up to 500 billion Japanese yen in order to refinance the borrowings under the SSTL.
Despite execution of the Subordinated Loan Agreement, Takeda plans to issue a maximum aggregate principal amount of 500 billion Japanese yen of Hybrid Bonds for the purpose of substituting all or a part of the amounts available under the Subordinated Loan Agreement, none of which has been drawn at this stage.
Features of the Hybrid Bonds
The Hybrid Bonds will be containing features of both equity and liabilities. While the liability aspects of the Hybrid Bonds will not cause dilution to stockholders, the Hybrid Bonds will have attributes and features resembling equity such as an option to defer interest payments, extremely long-term redemption periods and subordination in liquidation or bankruptcy proceedings. Therefore, Takeda expects that Japan Credit Rating Agency, Ltd. and S&P Global Ratings Japan Inc. will deem 50% of the funds raised under the Hybrid Bonds as equity for the purposes of their ratings.
A summary of the expected terms and conditions of the Hybrid Bonds, which is preliminary and subject to change, has been provided as Attachment 1 hereto.
Depending on market conditions and demand from investors, Takeda plans to determine the terms and conditions of the bonds, including the issue price, during or after April 2019. Takeda will publish an announcement promptly after the pricing of Hybrid Bonds occurs.
The total aggregate amount of hybrid financing incurred through the Hybrid Bonds and borrowings under the Subordinated Loan Agreement is expected to be 500 billion yen.
This announcement has been prepared to publicly disclose the proposed offering of the Hybrid Bonds and is not intended to, and does not, constitute, represent or form part of any offer, invitation or solicitation of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of, any securities whether pursuant to this announcement or otherwise.
This document does not constitute an offer to sell or a solicitation of an offer to purchase any securities within the United States. The Hybrid Bonds have not been and will not be registered under the U.S. Securities Act of 1933 (the 'Act') and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. No Hybrid Bonds will be offered in the United States.
About Takeda Pharmaceutical Company Limited
Takeda Pharmaceutical Company Limited (TSE:4502/NYSE:TAK) is a global, values-based, R&D-driven biopharmaceutical leader headquartered in Japan, committed to bringing Better Health and a Brighter Future to patients by translating science into highly-innovative medicines. Takeda focuses its R&D efforts on four therapeutic areas: Oncology, Gastroenterology (GI), Neuroscience and Rare Diseases. We also make targeted R&D investments in Plasma-Derived Therapies and Vaccines. We are focusing on developing highly innovative medicines that contribute to making a difference in people's lives by advancing the frontier of new treatment options and leveraging our enhanced collaborative R&D engine and capabilities to create a robust, modality-diverse pipeline. Our employees are committed to improving quality of life for patients and to working with our partners in health care in approximately 80 countries and regions.
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