Target name: AA
Target nation: UK
Date announced: 16/03/07
Sponsor (s):
Mandated arranger (s):
Financing: £1.85bn
The Automobile Association’s (AA) is seeking a waiver to allow a recapitalisation and repricing of its £1.85bn leveraged financing, via mandated lead arrangers Barclays. The deal will turn the financing into an all-senior deal with the mezzanine and second lien dent being taken out and the amount added to the B loan. Additionally, pricing on the A and B tranches has been cut 25bp, while pricing on the C loan has been lowered 50bp. Lenders are offered a 15bp waiver fee. Once the waiver passes, debt will comprise a £347m seven-year term loan A at 200bp, a £915m eight-year term loan B at 225bp and a £392m nine-year term loan C at 250bp, a £105m six-year receivables line at 225bp, a £100m six-year revolver at 225bp and a £150m seven-year acquisition line at 225bp. Previously, senior debt comprised a £373m six-year term loan A at 225bp over Libor, a £400m seven-year term loan B at 250bp, a £395m eight-year term loan C at 300bp, a £100m six-year revolver (including a £50m acquisition line) at 225bp and a £105m six-year receivables line at 225bp. The subordinated debt, which this new deal removes, comprised a £130m eight-and-a-half-year second lien tranche at 500bp, a £126m nine-year warranted mezzanine tranche paying 4.5% cash and 5% PIK and an £89m nine-year junior mezzanine tranche
Target name: AVR
Target nation: Netherlands
Date announced: 23/02/07
Sponsor:
Mandated arranger (s):
Financing: €1.87bn
AVR is in the market with a €910m add-on financing to fund its bolt-on acquisition of Benelux based rival Van Gansewinkel. Bookrunners are BNP Paribas, CIBC World Markets, ING and Lehman Brothers. The add-on is part of a €1.87bn facility that includes a refinancing of the debt that backed a consortium of sponsors including CVC and KKR buyout of AVR in 2006. The add-on comprises a €860m eight-year term loan B at 225bp over Euribor and a €50m seven-year revolver paying 187.5bp over Euribor. Banks are offered 40bp for €7.5m of the revolver, while existing lenders are offered a 15bp waiver fee to permit the add-on.
Target name:
Target nation: Switzerland
Date announced: 05/02/07
Sponsor (s):
Mandated arranger (s):
Financing: €885m
After securing a significant oversubscription in syndication Carl Zeiss Vision has requested a structural and pricing flex to its €885m refinancing, through bookrunners Deutsche Bank and Mizuho Corporate Bank and mandated lead arranger RBS. The request sees the second lien tranche reduced by €25m with the B increased by a similar amount. In addition margins on the A, B, revolving and second lien tranches are to be reduced. Debt is now split between a €100m term loan A paying 200bp over Euribor down from 212.5bp, a €625m term loan B at 250bp down from 275bp, a €100m revolver paying 200bp down from 212.5bp and a €65m second lien loan paying 400bp down from 500bp. Proceeds replace a €881m loan from 2005 that supported the merger between Carl Zeiss Ophthalmic Lens Division and SOLA and do not fund a dividend for shareholders Carl Zeiss AG and EQT. In syndication bank lenders were invited to join on €35m for 75bp, €25m for 62.5bp or €15m for 50bp. Funds were offered 70% of the B tranche and the entire second lien. The 2005 facility included senior, second lien and mezzanine elements and also closed oversubscribed.
Target name:
Target nation: Spain
Date announced: 10/01/07
Sponsor (s): Permira
Mandated arranger (s):
Financing: €488m
Spanish retailer Dinosol’s (formerly Ahold Sepermercados) €488m recapitalisation has been flexed after a heavy oversubscription, via mandated lead arrangers Caja Madrid, Bank of Scotland and SG. Permira is the sponsor. The €18m second lien tranche has been rolled into the B and C tranche and pricing on the B and C tranches have been reduced 12.5bp. Debt comprises a €50m seven-year term loan A at 200bp over Euribor, a €156.5m eight-year term loan B at 237.bp, a €156.5m nine-year term loan C at 287.5bp, a €100m seven-year revolver at 200bp and a €25m seven-year capex line at 200bp. Total net debt to EBITDA is 4.8x. Banks were offered 55bp for €40m and 40bp for €20m.
Target name:
Target nation: France
Date announced: 23/02/07
Sponsor (s):
Mandated arranger (s): BNP Paribas,
Financing: €2.1bn
French electronic parts distributor Rexel has mandated BNP Paribas, Calyon, HSBC an RBS to arrange a €2.1bn five-year pre-IPO financing. The five-year facility is made up of a €1.6bn A loan which will refinance debt and a €500m B loan for general corporate purposes and acquisitions. Pricing will ratchet between 30bp and 135bp over Euribor along a debt-to-EBITDA grid. Sponsors Clayton Dubilier Rice, Eurazeo and Merrill Lynch Private Equity filed plans on February 22 for an IPO expected in October 2007. The IPO is expected to raise €800m, if the equity offer raises in excess of €900m then part of the A loan will be paid down.
Target name:
Target nation: Germany
Date announced: 02/03/07
Sponsor (s):
Mandated arranger (s):
Financing: €250m
Dutch academic publisher Springer has wrapped up the €250m increase to its €1.945bn recapitalisation of last year, via mandated lead arranger Barclays. The increase is an add-on to the B loan, which will have a four-year tenor and pay 237.5bp over Euribor. Before this add-on, Springer’s debt comprised a €275.7m four-year term loan A at 200bp, a €272.4m five-year term loan at 237.5bp, a €272.4m six-year term loan C at 275bp, a €281.3m six-year term loan E at 275bp and a €150m four-year revolver at 200bp. The €260.3m seven-year second lien tranche will now pay 525bp, while the €278m eight-year mezzanine tranche, which will be partly repaid, now pays 8%.
Target name:
Target nation: Denmark
Date announced: 20/01/06
Sponsor (s):
Mandated arranger (s): Barclays,
Financing: €8.5bn
TDC is in the market with a repricing of the €8.5bn loan that backed an Apax Partners-led consortium’s €15bn buyout of the Danish telecommunications company last year. Barclays, Credit Suisse, Deutsche Bank, JPMorgan and RBS are again leading the transaction. That original deal remains Europe’s largest LBO financing. The repricing request is extremely aggressive with the lenders ask to accept a 37.5bp reduction on the A tranche, a 50bp reduction on the B tranche and a 75bp reduction on the C tranche. If the repricing is approved, the senior debt will comprise a €2.1bn seven-year term loan A at 175bp over Euribor, a €2.85bn eight-year term loan B at 187.5bp and a €2.85bn nine-term C loan at 212.5bp. The €700m seven-year revolver remains at 225bp.
Target name:
Target nation: Germany
Date announced: 12/03/07
Sponsor (s):
Mandated arranger (s):
Financing: €200m
Dresdner Kleinwort is out with the €200m recapitalisation of German fashion group Tom Tailor. Prior to launch BayernLB and NordLB joined. Alpha bought out the group in 2005 and this loan will also pay a dividend. The facility is split between a €40m seven-year term loan A paying 225bp over Libor, a €35m eight-year B at 250bp, a €35m nine-year C at 300bp, a €20m revolver, a €40m guarantee facility and a €30m mezzanine loan. Leverage ratios are set at 4x total and 3.8x senior and the group last reported sales of €220m and an EBITDA of €26m.
Target name:
Target nation: UK
Date announced: 27/02/07
Sponsor (s):
Mandated arranger (s):
Financing: £325m
Calyon and RBS have been mandated to arrange a £325m senior recapitalisation for Welcome Break, Investcorp’s UK motorway service station operator. As well as refinancing debt, the facility will fund a dividend for Investcorp. Since its buyout in 1997, Welcome Break has had something of a chequered history. The £473m buyout was financed through a whole business securitisation in the shape of a £376m bond. However, when a strategy to invest heavily in Welcome Break to improve profitability failed and the business ran into trouble the bonds tanked and Investcorp was forced to buy them back at par. The new seven-year package includes a £295m term loan, a £15m capital expenditure loan and a £15m revolver. Syndicated is expected to be launched next month.
Target name:
Target nation: 27/09/04
Date announced: 21/03/07
Sponsor (s): Apax and Cinven
Mandated arranger (s): JPMorgan
Financing: €1.161bn
JPMorgan has been mandated to arrange Europes first covenant-light deal with a €1.161bn deal for RefinancingWorld Directories. The deal sets a precedent in Europe where sponsors are known to have been pushing for covenant light deals for some time. The €1.161bn deal will refinance existing senior facilities and PIK note with a €1.025bn senior secured facility with incurrence based covenants and an additional PIK loan facility of up to €136m. World Directories stable and established cash flow and the loan-to-value ratio, which is understood to be 4.5x through the senior piece, makes it a good candidate to push forward the covenant issue. Sponsors will have looked carefully through existing portfolios before settling on the right candidate to pioneer the issue. The deal will be modelled on covenant-light deals done in the US and reflects the sponsors’ desire not only for the increased flexibility the absence of covenants allows but also a desire to move the European market closer to the US model. The deal is being undertaken in the knowledge that not only are sponsors active on both sides of the Atlantic but investors will have already been presented with similar deals through their US operations. While the covenant-light element is likely to capture headlines, the key motivation for the deal is the desire to reprice the existing facilities, which were put in place in 2004 and included a €400m seven-year amortising term loan A paying 225bp over Euribor, a €287.5m eight-year term loan B at 275bp, a €287.5m nine-year term loan C at 325bp and a €100m seven-year revolver at 225bp. Sponsors Apax and Cinven are likely to have selected this credit in particular to push forward the covenant light terms because like other refinancing deals it is far more likely to be supported by investors familiar with the credit than a new money deal. Other recent refinancings, notably Numericable, have been used to aggressively drive down pricing margins for the same reason.
Source: IFR/EVCJ
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