UPDATE 2-RLPC: Carlyle lines up financing for J&J diagnostics unit

Mon Jan 13, 2014 4:42pm EST

By Michelle Sierra

NEW YORK Jan 13 (Reuters) - Private equity firm Carlyle Group LP is readying a $3.7 billion financing that will back its purchase of Johnson & Johnson Inc's ortho clinical diagnostics unit, sources told Thomson Reuters LPC.

The acquisition deal is expected to be signed by the end of this week, though the signing could be delayed as discussions are ongoing.

The financing includes $2.15 billion in term loans and $1.15 billion in bonds. Rounding out the deal is a $300-400 million revolving credit.

Including equity and $3.3 billion in funded debt, the offer price is expected to be in the $4.1 billion to $4.5 billion range, according to sources.

Barclays and Goldman Sachs are leading the deal. Both banks are also advising in the transaction.

Barclays, Goldman Sachs and Carlyle Group representatives declined to comment. Representatives from J&J were unable to provide comment by press time.

In late December, Reuters reported that Carlyle was nearing an agreement to acquire Johnson & Johnson's ortho clinical diagnostics unit in a deal expected to be worth around $4 billion, citing sources familiar with the matter. Also according to Reuters, Carlyle's exclusivity period on the deal ends January 17.

Carlyle prevailed over a rival bid from Blackstone Group LP in partnership with healthcare and industrial conglomerate Danaher Corp.

J&J's ortho clinical diagnostics unit makes blood-screening equipment and laboratory blood tests. It also makes tests that can identify a patient's blood type and screen for viruses such as HIV and hepatitis C.

Johnson & Johnson said at the beginning of the year it would explore strategic alternatives for the unit and said the process could take from 12-24 months. It asked JPMorgan Chase & Co is advising on the sale of the unit.

A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

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