Unisteel LBO closes successfully

The US$280m loan backing KKR’s LBO of Singapore-listed Unisteel Technology has closed following commitments from five banks in general syndication. The original mandated leads Deutsche Bank, GE Commercial Finance, ING Bank and Morgan Stanley are likely to bring more banks into the deal post-closing.

The quartet ended up with US$36m as did DBS Bank which, along with Calyon, joined at the top ahead of the launch in late July. Calyon took US$25m.

Joining in general were KBC Bank, Natixis and Woori Bank with US$20m apiece, while Taiwan Business Bank and Taishin International Bank committed US$10m and US$5m respectively.

The facility is split into a US$116.5m five-year amortising term loan A, a US$126.5m six-year bullet term loan B and a US$37m five-year revolver. The term loan A features an average life of 3.5 years. The blended top level all-in is 356.73bp over Libor.

Syndication for the US$172m LBO financing backing Japanese sponsor Advantage Partners’ 100% acquisition of GST AutoLeather has closed following commitments from four lenders other than bookrunners GE Commercial Finance and ING Bank.

The duo ended up with US$27.5m each, while Development Bank of Japan and Tokyo Star Bank took US$25m apiece. Woori Bank committed US$20m and the Osaka branch of State Bank of India came in for US$5m.

These commitments were for the US$130m senior tranche that comprised a US$100m six-year senior term loan and a US$30m six-year revolver. A US$42m seven-year mezzanine debt piece is being sold to institutional investors. No commitments have been received on the mezz piece.

The leads are also likely to bring more lenders into the senior debt subsequently.

The senior debt pays a top level all-in of 532.89bp over Libor. Depending on the cash sweep mechanism the average life works out to 3.8 years. The leverage ratio of the senior loan is 2.5 times, while that of the whole facility is five times.

The mezz piece pays a coupon of 5% in cash, an additional 3% in PIK and has equity warrants attached to it, which works out to a Libor plus 11% all-in return. There is a floor for Libor at 3%.

More than six months after embarking on a plan to unlock the hidden value of its core assets, Hong Kong-listed PCCW last week called off the sale of a 45% stake in HKT Group Holdings to private equity firms. However, its chairman Richard Li is now said to be considering taking PCCW private in what could prove a master stroke if a stake in the company was sold when market conditions improve in the future.