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UKG cuts incremental and existing first-lien loan Libor floor to 0.5%
By Sara Rosenberg
New York, Nov. 15 – UKG Inc. (Ultimate Kronos Group) reduced the Libor floor on its fungible $1 billion incremental covenant-lite first-lien term loan due May 2026 (B1/B-) to 0.5% from 0.75% and is now changing the Libor floor on its existing $3.213 billion first-lien term loan due May 2026 to 0.5% from 0.75%, according to market sources.
The spread on the first-lien term loan debt is remaining at Libor plus 325 basis points.
Original issue discount talk on the incremental first-lien term loan is still 99.5 to 99.75. The existing first-lien term loan is offered at par.
As before, the company is also in market with a new $1.7 billion covenant-lite second-lien term loan due May 2027 (Caa1/CCC) talked at Libor plus 575 bps with a 0.5% Libor floor and a discount of 99.75.
The incremental first-lien term loan and existing first-lien term loan are getting 101 soft call protection for six months, and the second-lien term loan is getting hard call protection of 102 for six months and then 101 for a year.
Credit Suisse Securities (USA) LLC and Nomura are leading the deal, with Credit Suisse the left lead and agent on the first-lien and Nomura the left lead and agent on the second-lien.
Commitments are due at 5 p.m. ET on Wednesday, accelerated from 5 p.m. ET on Thursday, sources added.
Proceeds from the incremental first-lien term loan and new second-lien term loan will be used to refinance an existing second-lien term loan, pre-fund three acquisition targets and fund a cash distribution for future acquisitions and/or a dividend.
UKG is a provider of human capital management solutions based in Weston, Fla., and Lowell, Mass.
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