UCB has launched an offering of 'perpetual subordinated bonds' which the Belgian drugmaker expects will raise 300 million euros.
The bonds will be placed with institutional investors in Europe and the transaction is to be conducted by Bank of America Merrill Lynch, BNP Paribas and ING Belgium. UCB noted that the bonds, which qualify for accounting treatment as equity under the provisions of the international financial reporting standards (IFRS), are expected to be listed on the Luxembourg Stock Exchange.
A company spokeswoman told Reuters that "this hybrid is a very clever further optimisation of our capital structure as we can treat it as equity under IFRS, while it is offering attractive terms to investors". The proceeds will be used for general corporate purposes and refinancing activities.
Last week, UCB presented a healthy set of financials for 2010, with core profit up 5% to 731 million euros and revenues of 3.22 billion euros (+3%); the company’s net debt position decreased by 227 million euros to 1.53 billion euros compared with December 2009. However, 2011 will be tougher as earnings get hit by the patent expiry on the antiepileptic Keppra (levetiracetam).