Bankers prepare almost $1 billion of debt for LTS Lohmann sale
LONDON (Reuters) - Bankers are putting together about 700 million euros ($954 million) of debt financing to back a sale of German medical patch manufacturer LTS Lohmann, banking sources said on Friday.
LTS, in which Novartis (NOVN.VX) owns a 43 percent stake, was put up for sale in July and is expected to fetch more than 1 billion euros.
First-round bids are expected to be submitted on October 4, one of the sources said, with private equity firms EQT and Advent International among the potential buyers.
Novartis was not immediately available for comment.
Bankers are working on debt packages of about seven times the company's approximate 95 million euro earnings before interest, tax, depreciation and amortisation (EBITDA), the banking sources said.
A range of debt instruments are being considered, including senior leveraged loans and subordinated debt such as high-yield bonds or mezzanine financing, denominated in both euros and dollars, the sources added.
Bankers will be eager to do the deal given the lack of merger and acquisition activity this year. The deal, being handled by Morgan Stanley (MS.N), is expected to be attractive to prospective buyers, given the sector's resilience during the euro zone crisis.
LTS makes about 200 million euros in annual sales from nicotine and other medical patches to treat conditions including Parkinson's Disease and Restless Legs Syndrome.
(Editing by David Goodman)
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