Jazz Pharmaceuticals plc (NasdaqGS:JAZZ) signed an agreement to acquire GW Pharmaceuticals plc (NasdaqGM:GWPH) for $6.9 billion on February 3, 2021. Jazz Pharmaceuticals to acquire GW Pharmaceuticals for $220 per American Depositary Share, in the form of $200 in cash and $20 in Jazz ordinary shares. The exchange ratio of the collar consideration would be derived on the basis of a) $1.662/3 divided by Jazz market price, if the market price of Jazz is greater than $139.72 but less than $170.76; b) Exchange Ratio of 0.011929 if the market price is less than or equal to $139.72; c) Exchange Ratio of 0.009760 if the market price is greater than or equal to $170.76. The total consideration is $7.2 billion, or $6.7 billion net of GW Pharmaceuticals cash. The cash portion of the transaction consideration is expected to be funded through a combination of cash on hand and debt financing. Jazz has obtained fully committed debt financing from BofA Securities and J.P. Morgan Securities LLC. The financing includes a meaningful portion of pre-payable debt, in line with Jazz's commitment to rapid deleveraging. In connection with the transaction, Jazz has debt commitment letter, from Bank of America, N.A., BofA Securities, Inc., JPMorgan Chase Bank, N.A., Barclays Bank PLC, Citigroup Global Markets Inc., Credit Suisse Loan Funding LLC, Credit Suisse AG, Cayman Islands Branch, DNB (UK) Ltd., MUFG Bank, Ltd., Royal Bank of Canada, Sumitomo Mitsui Banking Corporation, Truist Bank, and Truist Securities, Inc. (collectively, the “debt commitment parties”) to provide, severally but not jointly, upon the terms and subject to the conditions set forth in the debt commitment letter, acquisition debt financing consisting of (i) senior secured credit facilities in the aggregate amount of $3,650 million, comprised of a $500 million five-year revolving credit facility and a $3,150 million seven-year term loan facility and (ii) a senior secured bridge loan facility in the amount of $2,200 million. Jazz Pharmaceuticals announced offering of $1.5 billion in an aggregate principal amount of 4.375% senior secured notes due 2029 and expects to use the net proceeds from the notes and acquisition date borrowings under the new senior secured credit facilities, together with cash on hand to fund the cash consideration. GW Pharmaceuticals is required to pay $71.5 million as termination fee to Jazz in case of termination of the transaction.

The transaction is subject to approval from the shareholders of GW Pharmaceuticals, sanction by the High Court of Justice of England and Wales and other customary closing conditions, certain regulatory approvals including expiration or early termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR Waiting Period), as amended, compliance by the other party in all material respects with such other party's obligations under the transaction agreement, accuracy of the other party's representations and warranties, subject to certain materiality standards set forth in the transaction agreement, the absence of any law or order prohibiting consummation of the transaction and the Jazz ordinary shares issuable in the transaction having been approved for listing on Nasdaq. The consummation of the Transaction is not subject to any condition that Jazz obtain any financing, but in certain circumstances closing of the transaction may be delayed if a 15 consecutive business day marketing period shall not have been afforded to Jazz at the time closing otherwise would have occurred. The transaction has been unanimously approved by the Board of Directors of GW Pharmaceuticals and Jazz Pharmaceuticals. The HSR Waiting Period expired on March 22, 2021. As of April 23, shareholders of GW Pharmaceuticals have approved the transaction, all shareholder and regulatory approvals required for the acquisition have now been obtained. In addition, the non-binding, advisory proposal to approve certain compensation arrangements for GW's named executive officers was approved. The Court hearing to sanction the acquisition is currently scheduled for May 5, 2021. The transaction is expected to close in the second quarter of 2021. Transaction is expected to complete in early May 2021.

Bobby Bal of Evercore Inc. and Guggenheim Securities, LLC acted as financial advisors for Jazz. Bobby Bal of Evercore is acting as debt advisor. Jazz Pharmaceuticals also received financial advice from BofA Securities, Inc. and J.P. Morgan Securities LLC. Victor Goldfeld and Mark Gordon of Wachtell, Lipton, Rosen & Katz, Charles Martin and Harry Coghill of Macfarlanes LLP and Arthur Cox LLP acted as legal advisors for Jazz Pharmaceuticals. Goldman Sachs & Co. LLC and Centerview Partners LLC acted as financial advisors and George F. Schoen, Damien R. Zoubek, Jonathan J. Katz, Stephen M. Kessing, Michael E. Mariani and Matthew M. Kelly, J. Leonard Teti II, David J. Kappos, Annmarie M. Terraciano, Brian M. Budnick and Jenny Hochenberg of Cravath, Swaine & Moore LLP and Andy Ryde and Paul Mudie of Slaughter and May acted as legal advisors for GW Pharmaceuticals. Graham Robinson and Christopher Barlow of Skadden, Arps, Slate, Meagher & Flom LLP represented Goldman Sachs and Centerview Partners as financial advisors to GW Pharmaceuticals. Stephen M. Kotran of Sullivan & Cromwell LLP acted as a legal advisor to Evercore Inc. (NYSE:EVR) and Guggenheim Securities, LLC. GW Pharmaceuticals will pay each a fee of $36 million to Goldman Sachs & Co. LLC and Centerview Partners LLC. Link Group Ltd acted as registrar, D.F. King Ltd acted as proxy solicitor and Citibank, N.A. acted as depository bank to GW Pharmaceuticals. Wilson Sonsini is representing Jazz Pharmaceuticals on IP matters related to the transaction.

Jazz Pharmaceuticals plc (NasdaqGS:JAZZ) completed the acquisition of GW Pharmaceuticals plc (NasdaqGM:GWPH) on May 5, 2021.