XML 68 R21.htm IDEA: XBRL DOCUMENT v2.4.0.8
Subsequent Events
6 Months Ended
Sep. 30, 2013
Subsequent Events [Abstract]  
Subsequent Events [Text Block]
Subsequent Events
On October 24, 2013, we entered into (i) a Share Purchase Agreement (the “SPA”) with Franz Haniel & Cie. GmbH (“Haniel”) and (ii) a Business Combination Agreement (the “BCA”) with Celesio AG (“Celesio”). Celesio’s issued and outstanding share capital is currently 50.01% owned by Haniel. Celesio is an international wholesale and retail company and provider of logistics and services to the pharmaceutical and healthcare sectors. Celesio operates in 14 countries and is headquartered in Stuttgart, Germany.
Under the terms of the SPA, McKesson will acquire a majority stake in Celesio for €23 per share per share from Haniel and launch parallel voluntary public tender offers for the remaining shares and outstanding convertible bonds of Celesio (the “Tender Offers”). The total transaction, including the assumption of Celesio’s outstanding debt, is valued at approximately €6.1 billion (or, assuming a currency exchange ratio of $1.35/1€, approximately $8.3 billion). The SPA may be terminated by either party if certain conditions are not met. In particular, if applicable antitrust approval is not received by the closing date, or if we do not acquire at least 75% of Celesio’s shares on a fully diluted basis, either Haniel or McKesson may terminate the agreement. We intend to complete the acquisition of the Celesio shares held by Haniel and the Tender Offers (together, the “Acquisition”) by utilizing the below described senior bridge term loan and cash on hand.
In connection with the Acquisition, we entered into a $5.5 billion 364-day unsecured Senior Bridge Term Loan Agreement (the “Bridge Loan Agreement”). Subject to the terms and conditions set forth in the Bridge Loan Agreement, up to two borrowings of term loans in an aggregate principal amount of up to $5.5 billion will be made available to us at our request to: (i) pay the Acquisition consideration; (ii) repay certain indebtedness of Celesio and its subsidiaries outstanding immediately prior to the closing of the Acquisition; and (iii) pay transaction costs associated with the Acquisition. The Bridge Loan Agreement contains terms substantially similar to those contained in our existing revolving credit facility and, similar to the revolving credit facility, borrowing under the Bridge Loan Agreement generally bears interest based upon either a prime rate or the London Interbank Offering Rate. In addition, the Bridge Loan Agreement requires that we maintain a debt to capital ratio of no greater than 65% throughout the Bridge Loan Agreement. We expect that we will refinance all or part of the outstanding amounts under the Bridge Loan Agreement with longer-term financing prior to the end of the Bridge Loan Agreement’s 364-day term.