Sanitec’s €1.015bn debt financing appears to be on track to close this week after RBS flexed up the €135m 9-1/2 year second lien tranche by 50bp to 600bp. The loan backs EQT’s secondary buyout of bathroom products manufacturer Sanitec from BC Partners. Mizuho Corporate Bank and HVB joined as MLAs ahead of launch and Nordea as a JLA.
Although the €880m senior debt posed no problems for the lead in syndication, the second-lien had met with a cooler response after the correction in the high-yield market. Before the flex, the bookbuilding scale ranged from 425bp to 550bp.
A fee has also been offered to investors joining the second-lien on larger tickets and the lead reported a number of additional commitments at the new level. A hedge fund lender said it had rejected the deal at an offer of 600bp and 98.5, however.
The piece is non-call two, and callable at 102 and 101 in the next two years.
Senior debt is split into a €340 seven-year term loan A at 225bp over Euribor, a €225m eight-year term loan B at 275bp, a €225m nine-year term loan C at 325bp, a €40m seven-year revolver at 225bp and a €50m seven-year restructuring line at 225bp. Leverage is 5.75% total, 4.9x senior, reflecting the sponsor’s 33% equity in the deal. Tickets of €60m were offered to sub-underwriters.