Mallinckrodt PLC said yesterday that an agreement to refinance a large chunk of its $5.4 billion debt load has fallen apart, and the drugmaker has instead struck a deal for a more limited bond exchange, WSJ Pro Bankruptcy reported. Mallinckrodt said yesterday that the previous deal, which would have refinanced over $1.2 billion of its near-maturing debt, has been terminated. The pact was premised upon the pharmaceutical giant being able to raise a new term loan, but the deterioration of financial markets as a result of the coronavirus pandemic made it difficult for Mallinckrodt to obtain the new financing. Instead, the company has entered into a new exchange agreement with bondholders Aurelius Capital Master Ltd., Franklin Advisers Inc., Capital Research and Management Co. and Columbus Hill Capital Management LP to exchange $495 million of bonds maturing on April 15 for a new first lien senior secured note due 2025, Mallinckrodt said Tuesday. The remaining $120 million balance on the bonds due next week will presumably be paid out from cash from the company’s balance sheet.
