SA’s biggest pharmaceutical manufacturer, Aspen Pharmacare, has closed its multi-currency, syndicated term loan and revolving credit facilities agreement totalling €1.26bn (R22.4bn), to refinance its syndicated loan facilities from 2018.
“We are very pleased with the outcome of this syndication, particularly noting the current global risk-off sentiment. It is encouraging to see that all invited lenders have supported the transaction, which is testament to their confidence in the Aspen Group,” group CEO Stephen Saad said in a brief statement.
The facilities were structured in rand, euro and Australian dollars with tenors — the length of time until a financial contract expires — of three to four years with extra extension options available.
Eighteen lenders committed from across Africa, the US, Europe, Australia and Asia. FirstRand, Nedbank, Citi and the Japanese MUFG Bank acted as co-ordinators and bookrunners for the transaction.
In May 2018, the company, valued at R66.1bn on the JSE, closed a similar credit line for €3.4bn with a similar structure and tenor. At the time the drugmaker had been expanding rapidly outside SA because of limited growth in the heavily regulated domestic market.
The company said in October that it was still holding out for orders of its own-brand Covid-19 vaccine, Aspenovax, hoping the need for boosters would shore up demand.
Aspen clinched a deal with US drug maker Johnson & Johnson in late 2020 to bottle its Covid-19 vaccine at its facility in Gqeberha, and then reached a licensing agreement to enable it to make Aspenovax for the African market.
But it still had no orders for its Aspenovax, despite the chorus of voices over the past year calling for Africa to develop its own vaccine capacity.
Africa’s limited vaccine production capacity, which means it imports 99% of the jabs it needs, relegated it to the back of the queue when shots against Covid-19 first became available. After an initial surge in demand, Africa’s vaccination rate stagnated at 20%. Many governments are grappling with a glut.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.