LONDON (Reuters) - European private equity fund CVC and Singaporean sovereign wealth fund Temasek are seeking to keep an existing $700 million leveraged loan financing for Alvogen in place to back their acquisition of a controlling stake in the pharmaceutical firm, banking sources said on Thursday.
CVC and Temasek agreed to buy the stake in a deal valuing the company at around $2 billion, it emerged earlier this week.
Existing lenders to Alvogen have been asked to consent to a change of control provision, which would allow the seven-year term loan to remain in place, despite a change in ownership.
Typically when a company is sold it triggers an automatic debt repayment.
The $700 million term loan was raised in April to refinance existing debt and fund general corporate purposes. The deal was led by Jefferies, Goldman Sachs and SunTrust and pays an interest margin of 500 basis points (bp) with a one percent Libor floor, according to Thomson Reuters LPC.
As part of the request, 101 soft call protection, which was put in place in April for six months will be reset. Lenders have been offered a 12.5bp consent fee.
Alvogen specializes in developing, licensing and manufacturing generic pharmaceutical products.
Editing by Christopher Mangham