NEW YORK — Quest Diagnostics on Thursday said it has priced a public offering of $1.85 billion in senior notes.
The offering comprises $400 million aggregate principal amount of its 4.6 percent senior notes due 2027, $600 million aggregate principal amount of its 4.625 percent senior notes due 2029, and $850 million aggregate principal amount of its 5 percent senior notes due 2034.
The offering is expected to close on Aug. 19 with net proceeds used to fund Quest's C$1.35 billion (US$983 million) acquisition of Canadian laboratory firm LifeLabs, and for general corporate purposes, which may include the redemption or repayment of the firm's $600 million aggregate principal amount of 3.5 percent senior notes due 2025, as well as for working capital, capital expenditures, or acquisitions.
The 2027 and 2029 notes are subject to a special mandatory redemption at a price of 101 percent of the aggregate principal amount of such series, as well as accrued and unpaid interest to the redemption date if the LifeLabs acquisition falls through, Quest said.
If Quest is required to redeem the 2027 and 2029 notes pursuant to the special mandatory redemption, the company plans to use the proceeds from the offering of the 2034 notes for general corporate purposes, including the redemption or repayment of the 3.5 percent senior notes and a possible payment of a termination fee connected to the LifeLabs deal. Proceeds from the offering of 2034 notes may also be used to pay the special mandatory redemptions of the 2027 and 2029 notes, Quest said.