Teva Pharmaceutical Industries Ltd. (Nasdaq:TEVA; TASE:TEVA) is currently raising $2.5 billion in a bond offering. The company had previously published a prospectus for three series of dollar bonds at changeable interest and redeemable in 2011, and two series of bonds at fixed interest and redeemable in 2012 and 2015. Teva began the bond offering today.

Part of the funds raised by the huge bond offering will be to redeem bonds issued in the past for the acquisition of Barr Pharmaceuticals, and the balance will serve the company in financing the acquisition of Ratiopharm. In order to acquire Ratiopharm, Teva received $1.5 billion in credit, and much of the remainder will be financed by the current bond offering.

Teva acquired Ratiopharm for $3.6 billion and took on $1.4 billion of the company's debt, and the company had $3 billion in cash at the end of the first quarter of 2010.

On announcing the acquisition, Teva said that it would finance the purchase from internal sources and external credit with at least $2 billion coming from foreign banks. Teva announced the acquisition in March, and it was the company's largest acquisition since it bought Barr for $9 billion in 2008.

The acquisition of Ratiopharm makes Teva, which was already the world's largest generic drug maker, the leading generic producer in Europe. Ratiopharm was the second largest generic manufacturer in the German market, which is worth $8.6 billion annually.

Teva's share price is up 0.2% on the Nasdaq to $53.29, giving a market cap of $47.59 billion. The shre fell 0.2% on the TASE today to NIS 203.30.

Published by Globes [online], Israel business news - www.globes-online.com - on June 15, 2010

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