Bank trio expected to lead financing on Zentiva sale

By Claire Ruckin

LONDON (LPC) - Goldman Sachs, JP Morgan and Morgan Stanley are expected to lead a debt financing totalling in excess of €1bn backing private equity firm Advent International’s acquisition of French healthcare group Sanofi’s (SASY.PA) European generics drugs arm Zentiva, banking sources said.

Sanofi entered exclusive talks to sell Zentiva to Advent for €1.9bn, including equity and debt, the companies said on Tuesday.

The three banks are expected to lead the financing but have yet to receive a formal mandate.

Up to six additional banks are expected to be mandated shortly on the financing as banks backing Advent and the other bidders during an auction process for the unit pitch to Advent to win a spot on the deal.

The financing closely mirrors a staple financing offered during the sale process, which totalled around 7.0 times Zentiva’s approximate €155m Ebitda.

It is expected to include around €1bn-€1.1bn of drawn debt, including senior leveraged loans and subordinated second-lien loans as well as additional undrawn facilities.

Advent declined to comment.

The planned sale of Zentiva began in October after Sanofi spent more than a year carving out the division to create a stand-alone company that could be sold to one of its competitors or to an investment fund.

In February, sources told Reuters that private equity firms Carlyle, BC Partners and a consortium of Blackstone and Nordic Capital had been shortlisted to buy Zentiva along with two industry players, Brazilian drugs firm EMS and India's Torrent Pharma.

Zentiva operates in 50 markets and has a strong presence in Eastern Europe, particularly in the Czech Republic, Slovakia and Romania.

(Editing by Christopher Mangham)