Cencora, Inc. (COR, Financial), a Delaware corporation, has announced the entry into a significant Term Credit Agreement as part of its strategic acquisition plans. On November 26, 2024, the company finalized a Term Credit Agreement with Bank of America, N.A., acting as the administrative agent, to secure a senior unsecured term facility amounting to $1.5 billion. This financial move is in connection with the proposed acquisition of Retina Consultants of America.
The Term Loan, which matures three years from the draw date, will be utilized to cover a portion of the cash consideration for the acquisition and associated fees. The interest on the Term Loan will be determined based on Cencora's public debt ratings, with applicable margins ranging from 87.5 to 137.5 basis points over the adjusted Term SOFR rate, or 0 to 37.5 basis points over the alternate base rate.
In addition to the Term Loan, Cencora has also entered into a $1.0 billion senior unsecured revolving credit facility with Bank of America, N.A. This Revolving Credit Facility, available post-acquisition closing, will mature 364 days after the closing date, with an option to extend under certain conditions.
Both credit agreements include covenants similar to Cencora's existing $2.4 billion multi-currency senior unsecured revolving credit facility, ensuring compliance with a financial leverage ratio not exceeding 3.75 to 1.00, adjustable to 4.00 to 1.00 at the company's discretion during the acquisition quarter.
These strategic financial arrangements underscore Cencora's commitment to enhancing its market position through targeted acquisitions while maintaining robust financial health. The company's proactive approach in securing these credit facilities reflects its strategic foresight and dedication to long-term growth.
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