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Warner Chilcott's Special Cash Dividend

Warner Chilcott, a leading specialty pharmaceutical company in North America and Western Europe, announced today a special cash dividend of $8.50 per share.

This means $2.25 billion of new debt will be used to fund a special dividend to shareholders— approximately $2.15 billion in the aggregate.

The new debt is expected to be comprised of a combination of senior secured-term loans and additional unsecured debt.

Warner is a product of a leveraged buyout (LBO)—it does trade, but is still owned, in part, by private equity. Perhaps this is the reason for the significant size of the leverage recap.

The company expects to declare and pay the special cash dividend before the end of the third quarter of 2010.

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