Teva Announces Early Tender Results of its Debt Tender Offer, Increase to Tender Pool Caps and Total Maximum Amount and Election of Early Settlement

Rhea-AI Summary

Teva Pharmaceutical announced early tender results for its debt tender offers, including increases to tender pool caps and total maximum amount. The company increased Pool 2 Tender Cap from $250M to $350M, Pool 3 Tender Cap from $200M to $400M, and Total Maximum Amount from $2.25B to $2.3B. The tender offers cover multiple series of senior notes with various interest rates and maturities. Teva expects to accept notes worth approximately $2.3B for purchase, with settlement scheduled for June 5, 2025. The tender offers are funded through proceeds from a recent public offering of debt securities and cash on hand. This move is part of Teva's strategy to manage and optimize its debt capital structure and extend its debt maturity profile.

Positive

• Proactive debt management to optimize capital structure and extend maturity profile
• Secured funding through recent debt offering and cash on hand to support the tender offers
• Strong response from noteholders with significant tender amounts across all pools
• Increased tender caps demonstrate company's enhanced debt management capacity

Negative

• Taking on new debt to refinance existing obligations
• Potential increase in interest expenses due to new debt issuance
• Complex debt structure with multiple series of notes and tender pools

Insights

Corporate Finance Analyst

Teva's debt restructuring enhances financial flexibility by extending maturities and optimizing capital structure with $2.3B tender offer.

Teva's debt tender offer represents a strategic liability management exercise with significant implications for the company's financial structure. The pharmaceutical giant is effectively replacing older debt with newly issued securities, having successfully executed a $2.3 billion (equivalent) tender offer for six different series of notes across three distinct pools.

The strong participation in the early tender, particularly the $2.6 billion tendered in the 2026 notes against a $1.55 billion cap, demonstrates investor willingness to participate in Teva's debt optimization strategy. The company has strategically increased the caps for Pool 2 and Pool 3 from the original amounts, allowing them to retire more higher-coupon debt.

This transaction achieves two critical financial objectives: extending Teva's debt maturity profile and potentially reducing interest expenses. By replacing near-term maturities (2026-2027 notes) with longer-dated debt from their recent May 28th offering, Teva gains improved financial flexibility and reduced refinancing risk in the coming years.

The company's approach of funding this tender with proceeds from a new debt offering rather than cash reserves preserves liquidity while restructuring liabilities. This demonstrates a sophisticated capital management approach rather than an urgent need to reduce leverage. By accepting tenders up to the $2.3 billion maximum amount at the early settlement date, Teva is taking advantage of the $50 per $1,000 early tender premium, effectively closing the tender offers despite the June 17th official expiration.

This liability management exercise, while not directly impacting Teva's overall debt level, represents prudent financial stewardship that strengthens the company's debt profile by extending maturities and potentially optimizing interest costs.

TEL AVIV, Israel, June 03, 2025 (GLOBE NEWSWIRE) -- Teva Pharmaceutical Industries Ltd. (NYSE and TASE: TEVA) (“Teva”) announced today the early tender results in connection with its previously announced tender offers (the “Offers”) as specified below for the following series of notes issued by finance subsidiaries of Teva and guaranteed by Teva:

• USD 3.150% Senior Notes due 2026, CUSIP 88167AAE1 / ISIN US88167AAE10 (Registered), issued by Teva Pharmaceutical Finance Netherlands III B.V. (the “Pool 1 Notes”);
• USD 4.750% Sustainability-Linked Senior Notes due 2027, CUSIP 88167AAP6 / ISIN US88167AAP66 (Registered), issued by Teva Pharmaceutical Finance Netherlands III B.V. (the “Priority 2 Notes”);
• EUR 3.750% Sustainability-Linked Senior Notes due 2027, Common Code 240660709 / ISIN XS2406607098 (Registered), issued by Teva Pharmaceutical Finance Netherlands II B.V. (the “Priority 3 Notes,” and together with the Priority 2 Notes, the “Pool 2 Notes”);
• USD 7.875% Sustainability-Linked Senior Notes due 2029, CUSIP 88167AAS0 / ISIN US88167AAS06 (Registered), issued by Teva Pharmaceutical Finance Netherlands III B.V. (the “Priority 4 Notes”);
• EUR 7.375% Sustainability-Linked Senior Notes due 2029, Common Code 259280443 / ISIN XS2592804434 (Registered), issued by Teva Pharmaceutical Finance Netherlands II B.V. (the “Priority 5 Notes”); and
• USD 8.125% Sustainability-Linked Senior Notes due 2031, CUSIP 88167AAR2 / ISIN US88167AAR23 (Registered), issued by Teva Pharmaceutical Finance Netherlands III B.V. (the “Priority 6 Notes,” and together with the Priority 4 Notes and the Priority 5 Notes, the “Pool 3 Notes,” and the Pool 3 Notes, together with the Pool 1 Notes and the Pool 2 Notes, the “Notes”).

As previously announced, Teva increased the Pool 2 Tender Cap and the Pool 3 Tender Cap (each, as defined below) from $250.0 million (equivalent) to $350.0 million (equivalent) and from $200.0 million (equivalent) to $350.0 million (equivalent), respectively, in each case representing aggregate cash purchase price (exclusive of accrued and unpaid interest).

In addition, Teva has exercised its discretion to further increase the pool tender cap for the Pool 3 Notes from $350.0 million (equivalent) to $400.0 million (equivalent) total purchase price (exclusive of accrued but unpaid interest) (the “Pool 3 Tender Cap”). The pool tender caps for the Pool 1 Notes (the “Pool 1 Tender Cap”) and the Pool 2 Notes (the “Pool 2 Tender Cap” and, together with the Pool 1 Tender Cap and the Pool 3 Tender Cap, the “Pool Tender Caps”) will remain unchanged. The combined aggregate purchase price (exclusive of accrued and unpaid interest) for Notes (the “Total Maximum Amount”) is increased from $2,250,000,000 (equivalent) to $2,300,000,000 (equivalent). Except as provided above, the terms and conditions of the Offers remain unchanged.

Teva is engaging in the Offers to proactively manage and optimize its debt capital structure, and to extend the maturity profile of its debt. Teva expects to fund the Offers with the proceeds from the registered public offering of Teva Pharmaceutical Finance Netherlands II B.V., Teva Pharmaceutical Finance Netherlands III B.V. and Teva Pharmaceutical Finance Netherlands IV B.V. of debt securities that commenced concurrently with the Offers and closed on May 28, 2025, with gross proceeds, together with cash on hand, sufficient to fund the Total Consideration for Notes to be purchased pursuant to the Offers.

The respective principal amounts of all series of Notes that were validly tendered and not validly withdrawn at or prior to 5:00 p.m., Eastern Time, on Monday, June 2, 2025 (the “Early Tender Time”) are specified in the table below. Holders who validly tendered and did not validly withdraw Notes at or prior to the Early Tender Time and whose Notes are accepted for purchase pursuant to the Offers will receive the applicable “Total Consideration,” (as defined in the Offer to Purchase), which already includes an early tender premium of $50.00 per $1,000 or €50.00 per €1,000, as applicable, principal amount of the Notes accepted for purchase pursuant to the Offers (the “Early Tender Premium”).

The following table sets forth the early results of the Offers:

Capped Tender Offers	Title of Notes	Issuer	CUSIP / ISIN / Common Code	Principal Amount Tendered(2)	Pool Tender Caps (purchase price)(1)(2)	Acceptance Priority Level(3)
Pool 1 Tender Offers	3.150% Senior Notes due 2026	Teva Pharmaceutical Finance Netherlands III B.V.	88167AAE1 / US88167AAE10 (Registered)	$2,602,331,000	$1,550,000,000	1
Pool 2 Tender Offers	4.750% Sustainability-Linked Senior Notes due 2027	Teva Pharmaceutical Finance Netherlands III B.V.	88167AAP6 / US88167AAP66 (Registered)	$781,072,000	$350,000,000 (equivalent)	2
	3.750% Sustainability-Linked Senior Notes due 2027	Teva Pharmaceutical Finance Netherlands II B.V.	XS2406607098 / 240660709 (Registered)	€532,083,000		3
Pool 3 Tender Offers	7.875% Sustainability-Linked Senior Notes due 2029	Teva Pharmaceutical Finance Netherlands III B.V.	88167AAS0 / US88167AAS06 (Registered)	$202,316,000	$400,000,000 (equivalent)	4
	7.375% Sustainability-Linked Senior Notes due 2029	Teva Pharmaceutical Finance Netherlands II B.V.	XS2592804434 / 259280443 (Registered)	€349,888,000		5
	8.125% Sustainability-Linked Senior Notes due 2031	Teva Pharmaceutical Finance Netherlands III B.V.	88167AAR2 / US88167AAR23 (Registered)	$116,975,000		6

^{(1)   The Pool 1 Tender Cap represents the maximum aggregate purchase price in respect of Pool 1 Notes that will be purchased in the Pool 1 Tender Offers. The Pool 2 Tender Cap represents the maximum aggregate purchase price in respect of Pool 2 Notes that will be purchased in the Pool 2 Tender Offers. The Pool 3 Tender Cap represents the maximum aggregate purchase price in respect of Pool 3 Notes that will be purchased in the Pool 3 Tender Offers. The Pool Tender Caps can be increased or decreased at Teva’s sole discretion.
(2)   In order to determine whether the Total Maximum Amount (as defined below) and Pool Tender Caps have been reached, an exchange rate of $1.1443 = €1.00 will be used, as determined at 10:30 a.m. Eastern Time on the date of the Early Tender Time.
(3)   Subject to the Total Maximum Amount, the Pool Tender Caps and proration, the principal amount of each series of Notes that is purchased in each of the Offers will be determined in accordance with the applicable acceptance priority level (in numerical priority order) specified in this column.}

Subject to the terms and conditions of the Offers, Teva expects that it will accept for purchase Notes validly tendered and not validly withdrawn at or prior to the Early Tender Time for a combined aggregate purchase price (exclusive of accrued and unpaid interest but inclusive of tender premium) equal to approximately $2,300,000,000. The settlement for the Notes accepted by Teva in connection with the Early Tender Time is expected to take place on Thursday, June 5, 2025 (the “Initial Settlement Date”). The amount of each series of Notes that is to be purchased on the Initial Settlement Date will be determined in accordance with the acceptance priority levels and the proration procedures described in the Offer to Purchase, dated May 19, 2025 (the “Offer to Purchase”), subject in each case to the Total Maximum Amount and the Pool Tender Caps.

The Withdrawal Deadline has passed and has not been extended. Notes tendered pursuant to the Offers may no longer be withdrawn, except as required by law.

The Offers will expire at 5:00 p.m., Eastern Time, on Tuesday, June 17, 2025, unless extended or earlier terminated (as it may be extended or earlier terminated, the “Expiration Time”). However, as Teva intends, subject to the terms and conditions of the Offers, to accept for purchase the Total Maximum Amount on the Initial Settlement Date, further tenders of Notes prior to the Expiration Time will not be accepted for purchase.

Teva’s obligation to accept for purchase and to pay for the Notes validly tendered (and not validly withdrawn) pursuant to the Offers is subject to the satisfaction or waiver of certain conditions set out in the Offer to Purchase. Teva reserves the right, subject to applicable law and the terms of the Offers, to waive any and all conditions to the Offers or to otherwise amend, extend or terminate the Offers in any respect.

BNP PARIBAS, HSBC Bank plc, Intesa Sanpaolo S.p.A., J.P. Morgan Securities plc and Merrill Lynch International (or their respective affiliates) are acting as the Dealer Managers for the Offers. The information and tender agent (the “Information and Tender Agent”) for the Offers is D.F. King. Copies of the Offer to Purchase are available by contacting the Information and Tender Agent at (800) 967-5068 (toll-free), (212) 269-5550 (collect) or +44 20-7920-9700 (UK) or by email at teva@dfkingltd.com. All documentation relating to the offer, together with any updates, will be available via the Offer Website: https://clients.dfkingltd.com/teva. Questions regarding the Offers should be directed to BNP PARIBAS, at +33 1 55 77 78 94 (Europe), +1 (888) 210 4358 (U.S. Toll Free), +1 (212) 841 3059 (U.S.) or by email at liability.management@bnpparibas.com, to HSBC Bank plc, at +44 20 7992 6237 (Europe), +1 (888) HSBC-4LM (U.S. Toll Free), +1 (212) 525-5552 (Collect) or by email at LM_EMEA@hsbc.com, to Intesa Sanpaolo S.p.A., at +39 02 7261 6502 or by email at IMI-liability.management@intesasanpaolo.com, to J.P. Morgan Securities LLC at +1 (866) 834-4666 (U.S. toll free), +1 (212) 834-4818 (Collect), to J.P. Morgan Securities plc at +44 207 134 2468 (Europe) or by email at liability_management_emea@jpmorgan.com, and to Merrill Lynch International at +44 207 996 5420 (Europe), +1 (888) 292-0070 (U.S. Toll Free) or by email at DG.LM-EMEA@bofa.com.

This announcement shall not constitute an offer to sell, a solicitation to buy or an offer to purchase or sell any Notes. The Offers are being made only pursuant to the Offer to Purchase and only in such jurisdictions as is permitted under applicable law.

Capitalized terms used in this announcement but not otherwise defined shall have the meanings given to them in the Offer to Purchase.

About Teva

Teva Pharmaceutical Industries Ltd. (NYSE and TASE: TEVA) is a different kind of global biopharmaceutical leader, one that operates across the full spectrum of innovation to reliably deliver medicines to patients worldwide. For over 120 years, Teva’s commitment to bettering health has never wavered. Today, the company’s global network of capabilities enables its 37,000 employees across 57 markets to advance health by developing medicines for the future while championing the production of generics and biologics. We are dedicated to addressing patients’ needs, now and in the future. Moving forward together with science that treats, inspired by the people we serve.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which are based on management’s current beliefs and expectations and are subject to substantial risks and uncertainties, both known and unknown, that could cause our future results, performance or achievements to differ significantly from that expressed or implied by such forward-looking statements. Important factors that could cause or contribute to such differences include risks relating to: settlement of the tender offers for certain outstanding notes; our significant indebtedness, which may limit our ability to incur additional indebtedness, engage in additional transactions or make new investments, and may result in a further downgrade of our credit ratings; our inability to raise debt or borrow funds in amounts or on terms that are favorable to us; and other factors discussed in our Quarterly Report on Form 10-Q for the first quarter of 2025, our Annual Report on Form 10-K for the year ended December 31, 2024, including the sections thereof captioned “Risk Factors” and “Forward Looking Statements,” and other filings with the SEC, which are available at www.sec.gov. Forward-looking statements speak only as of the date on which they are made, and we assume no obligation to update or revise any forward-looking statements or other information contained herein, whether as a result of new information, future events or otherwise. You are cautioned not to put undue reliance on these forward-looking statements. No assurance can be given that the transactions described herein will be consummated or as to the ultimate terms of any such transactions.

Teva Media Inquiries:
TevaCommunicationsNorthAmerica@tevapharm.com

Teva Investor Relations Inquiries:
TevaIR@Tevapharm.com

FAQ

What is the purpose of Teva's debt tender offer?

Teva is conducting the tender offers to proactively manage and optimize its debt capital structure and extend the maturity profile of its debt.

How much is Teva's total maximum tender amount for the debt offer?

Teva increased the Total Maximum Amount from $2.25 billion to $2.3 billion equivalent for the tender offers.

When is the settlement date for Teva's debt tender offer?

The initial settlement date for the tender offers is scheduled for Thursday, June 5, 2025.

How is Teva funding the debt tender offers?

Teva is funding the offers through proceeds from a registered public offering of debt securities that closed on May 28, 2025, along with cash on hand.

What are the new tender pool caps for Teva's debt offer?

The Pool 2 Tender Cap was increased to $350 million equivalent and the Pool 3 Tender Cap was increased to $400 million equivalent, while Pool 1 Tender Cap remains unchanged at $1.55 billion.