Gardner Denver Sets $2.7B Loan For KKR Deal

  • In support of KKR’s $3.9 billion LBO
  • Industrial machinery maker serves many markets
  • Company was pressured by investor to act

Global industrial machinery maker Gardner Denver set a bank meeting to launch a $2.725 billion bank loan to back its $3.9 billion leveraged buyout by Kohlberg Kravis Roberts & Co, sources told sister service Thomson Reuters Loan Pricing Corp.

The financing package will consist of a $400 million, five-year revolving credit facility, a $1.8 billion, seven-year U.S. dollar term loan, and a $525 million, seven-year euro-denominated term loan.

UBS is left lead on the senior secured loans with Barclays, Citi, Deutsche Bank, Mizuho, RBC, Macquarie and HSBC acting as joint bookrunners. KKR Capital Markets and Sumitomo Mitsui are also lead arrangers.

Both the U.S dollar TLB and the euro TLB will amortize at 1 percent per year.

Gardner Denver had revenues of approximately $2.4 billion in 2012. The company manufactures engineered products for industrial, medical, environmental, transportation and process applications. It also provides fluid transfer equipment to the chemical, petroleum and food industries. The company decided to put itself up for sale late last year following months of pressure from activist investor ValueAct Capital LLC, which acquired a roughly 5 percent stake.

Caleb Frazier is New York bureau chief for Thomson Reuters LPC.