S&P assigns Armacell loan B

S&P said it assigned B ratings to Neptune Holdco Sarl and its proposed term loan, which will be used by PAI Partners and Kirkbi to buy Armacell from Blackstone and repay debt.

The financing package includes a €710 million senior secured term loan B due 2027 (to be co-borrowed by financing subsidiaries Neptune Bidco Sarl and Neptune US Bidco Inc.) and a €110 million senior secured revolver due 2026, which will be used to repay Armacell’s term loan due 2023. There’s about €610 million outstanding on Armacell’s loan.

PAI and Kirkbi will provide €594 million of equity including about €75 million of preferred equity certificates, which S&P views as equity. Post transaction, the capital structure will also include about €48 million of operating-lease liabilities and €38 million of other bank debt rolled over at various operating subsidiaries.

“We anticipate pro forma adjusted debt to EBITDA of about 7x in 2019, reflecting the new capital structure, improving toward 6.5x in 2020,” S&P said in a press release.

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