Sigma-Aldrich Corp. has put in place a $300 million credit facility led by Wells Fargo and Wachovia Capital Markets to provide firepower for future acquisitions. This follows the company's largest acquisition in history, when the life sciences company bought JRH Biosciences, a global supplier of cell culture, from CLS for $370 million last month. It has also agreed to buy Proligo Group, a Boulder-based global supplier of genomic research tools, from German-based chemical company Degussa.
The new facility consists of a $150 million, three-year term loan and a five-year, $150 million revolving credit. It replaces a $150 million short-term facility expiring March 7. The company has not announced any other acquisitions, but Michael Hogan, cfo, chief administrative officer and secretary, said the company is always looking for opportunities to grow.
Hogan said the company considered a number of banks, but after the bidding process, Wells Fargo and Wachovia separated themselves from the pack. "Wells Fargo and Wachovia have consistently shown up and responded quickly with good terms. They just distinguished themselves," Hogan said. Wells Fargo led Sigma-Aldrich's previous $150 million facility.
Rohan Paul, a managing director at Wachovia and Steve Buehler at Wells Fargo served as point-men for Sigma-Aldrich. Goldman Sachs advised the company on its acquisition of JRH. The acquisition was funded through existing cash, short-term debt and the three-year term debt. Including funding for this acquisition, Sigma-Aldrich expects to remain within its targeted debt to capital ratio of 30-35% during 2005.