Nature is preparing for a debt of 8 billion d: Is the issuance of shares on the way

Teva’s stock posted a sequence of declines over five days of trading on Wall Street after the reports, and only last week began to recover slightly. On Friday, however, she was again weakened to a price that reflects a market value of $ 19.8 billion – about $ 5 billion less than a January. As a result of the decline, Teva lost its status as the highest Israeli society in Wall Street (after Check Point) and in Tel Aviv (after Bank Leumi).

Despite the current weakness in the stock, Teva, under the management of Richard Francis, the weekend access to a shelf that will allow it to issue ADS (tracking bonds for the stock, traded on the New York Stock Exchange), various kinds of debt and other securities.

If Teva does use the shelf prospectus and raise capital, it will be the first time since 2015 – then the company has raised about $ 7 billion, compared to some debt raises in recent years. However, it is also estimated that this time nature would prefer to recruit debt.

In the served shelf prospectus, Teva noted that the consideration from the recruitment (if it did) would be used for general business needs, return capital and return debt. During 2025, $ 1.8 billion debt returns (some in Swiss and Irawe) and 2026 – 2027 debt repayments are higher and reach $ 3.4 billion and $ 2.9 billion, respectively.

Reduced the burden of debt steadily

Recall that the last capital recruitment that Teva has committed in the middle of the previous decade is designed to help fund the acquisition of companies Actavis and Ramesa. The acquisition of $ 40 billion in Actavis is mainly in debt, which later complicated nature and approached it into a liquidity crisis, which then led to management changes and perform an aggressive streamlining program.

At the same time, the debt rating agencies were then lowered to a speculative nature rating (“garbage” bonds), and its stock plummeted. Remsa’s acquisition was also failed, led to the claims that the sellers misled nature and legal process that ended in the arrangement.

At its peak, Teva’s debt was about $ 37 billion, after the acquisition of Actavis in 2016. Over the past few years, Teva has been able to steadily reduce the amount of debt, and at the end of 2024, it was $ 17.8 billion – a decrease from $ 19.8 billion a year earlier, thanks to $ 1.6 billion in debt and exchange rate fluctuations that affected the best volume of debt. The net debt was $ 14.5 billion at the end of the year, and Teva improved the net debt ratio to EBITDA, which was 3 (compared to about 3.5 at the end of 2023), and it also reiterated its intention to reach a target of 2 in 2027.

The rating agencies have also responded to changes in nature, and in recent months S&P has raised the company from BB minus to BB, and a similar step has come from the direction of Fitch. At the same time, Modi’s has changed the rating horizon of a positive nature.

Donation of the Sales of the Raw Materials Division

Apart from raising capital or debt, nature can use the sale of its raw materials division to continue reducing debt. Teva has already announced that it intends to sell the division, which is currently operating as an independent division, and is expecting to complete a deal for selling it in the first half of the year.

The Jeffris Investment Bank recently estimated that such a sale could put in nature to $ 2.5 – 3 billion, based on similar transactions made at the EBITDA multiplier of 10. Jeffris economists also estimated that the sale of the raw material division helps nature to reduce the debt and invest in growth. The Lider Investment House noted in this context that the completion of the sale of the division may contribute not only to Teva’s debt but also to increase the company’s business focus.

Teva finished 2024 with a 4.4% growth in revenue for more than $ 16.5 billion, and with a net Non-GAAP profit of $ 2.49 per share. According to the usual accounting rules (GAAP) the company lost in 2024 an amount of close to $ 2 billion.

A currency said that “this is a shelf prospectus from time to time as a routine and automatically.