Note 15 – Net Debt Audited


The net debt comprises:


Non-Current Debt

million CHF 2017 2016
         
Straight bonds 1,213 1,317
Syndicated loan (2017–2022) 223 0
Syndicated loan (2011–2018) 0 99
Term loans 993 0
German private placement 1,108 5
Other long-term debt 182 144
Finance lease liabilities 11 6
Total non-current debt 3.730 1,571

 

Straight Bonds – Fixed Interest Rates

million CHF 2017 2016
     
3.125% CHF 140 million, 2011/2018, due 7 December 2018, issued at 100.56% 140 139
2% CHF 200 million, 2012/2018, due 11 October 2018, issued at 100.21% 200 200
3% CHF 105 million, 2012/2022, due 11 October 2022, issued at 100.74% 105 105
1.75% CHF 300 million, 2013/2019, due 10 April 2019, issued at 100.45% 299 299
0.625% CHF 150 million, 2015/2020, due 22 September 2020, issued at 100.135% 150 150
1.25% CHF 175 million, 2015/2023, due 22 September 2023, issued at 100.133% 175 175
0.125% CHF 250 million, 2016/2021, due 1 November 2021, issued at 100.037% 249 249
0.2% CHF 125 million, 2017/2021, due 12 July 2021, issued at 100.179% 125 0
0.7% CHF 110 million, 2017/2024, due 12 July 2024, issued at 100.222% 110 0
Total including current portion 1,553 1,317
Less current portion of straight bonds (340) 0
Total non-current straight bonds 1,213 1,317

Acquisition Bridge Financing

 

The acquisition of Capsugel was financed with a combination of debt and equity financing. Lonza had committed debt financing (bridge financing) for the full acquisi­tion amount of USD 5.5 billion from Bank of America Merrill Lynch and UBS, of which USD 1,457 million was raised in July 2017. The net proceeds of the bridge financing received in 2017 amounted to CHF 1,380 million after considering up-front fees of CHF 19 million (an additional CHF 18 million was paid in 2016). The bridge financing was fully repaid in 2017 and consequently the related up-front fees of CHF 37 million were recorded in the income statement.

Term Loans

 

Lonza issued term loans of EUR 450 million and USD 489 million tranches carrying fixed interest rates and repayable in 2020 and 2022 (EUR 225 million and USD 245 million at the first maturity date), respectively. The net proceeds of the two term loan tranches received in 2017 totaled CHF 955 million.

German Private Placement (issued in 2012) 

 

Dual-currency German private placement (Schuldscheindarlehen) of EUR 34 million and USD 12 million tranches carried fixed and floating interest rates (LIBOR / EURIBOR + margin). The carrying amount was CHF 49 million as of 31 December 2016 and was fully repaid in 2017.

German Private Placement (Issued in 2017)

 

  • Dual-currency German private placement (Schuldscheindarlehen) of EUR 700 million and USD 200 million tranches carry fixed and floating interest rates (LIBOR / EURIBOR + margin) respectively, and are repayable in 2021 (EUR 325 million), 2022 (USD 150 million), 2023 (EUR 375 million) and 2024 (USD 50 million). The net proceeds of the German private placement tranches totaled CHF 986 million.
  • Single-tranche German private placement (Schuldscheindarlehen) of USD 100 million carrying floating interest rates (LIBOR + margin) and repayable in 2024. The net proceeds amount to CHF 99 million.

Syndicated Loan

 

In 2017 Lonza signed a new syndicated loan with a consortium of banks on the following terms: Credit facility of CHF 700 million, of which CHF 230 million was used as of 31 December 2017, due 2022, at floating interest rates (based on LIBOR). The net proceeds of the syndicated loan facility amount to CHF 225 million. The syndicated loan agreement contains a financial covenant that is based on Lonza’s net debt / EBITDA ratio. The Group was in compliance with the covenant as of 31 December 2017.

Others 

 

Other non-current debt comprises industrial revenue bonds of USD 187 million (2016: USD 142 million) issued by governmental institutions in the United States (repayable in 2020, 2022, 2025, 2030 and 2047). The private placement of senior notes amounting to USD 158 million with certain institutional investors was repaid in 2017.

Current Debt

million CHF 2017 2016
     
Due to banks and other financial institutions   119   68
Others   56   16
Leasing   1   0

Non-current debt due within one year

   
– Straight bond (2011–2018) 140   0  
– Straight bond (2012–2018) 200   0  
– German private placement 0   44  
– US private placement 0 340 161 205
Total current debt   516   289

 

Debt: Movements in Carrying Value of Recognised Liabilities

Breakdown of Total Debt by Currencies

million CHF 2017 2016
  Average
interest
rate %
%   Average
 interest
rate %
%  
     
CHF 1.42 45 1,927 1.41 80 1,494
EUR 1.15 32 1,343 2.12 2 37
USD 2.57 23 976 2.63 18 327
Other 0 0 0 0 0 2
Total   100 4,246   100 1,860