Waddington Group shifts funds between term loans, updates pricing

By Sara Rosenberg

New York, May 21 - Waddington Group (WNA Holdings Inc.) upsized its U.S. seven-year covenant-light first-lien term loan (B1/B) to $375 million from $350 million and downsized its 71/2-year covenant-light second-lien term loan (Caa1/CCC+) to $125 million from $150 million, according to a market source.

Also, pricing on the U.S. first-lien term loan was reduced to Libor plus 325 basis points from talk of Libor plus 350 bps to 375 bps, pricing on a C$100 million seven-year covenant-light first-lien term loan (B1/B) firmed at Libor plus 425 bps, the tight end of the Libor plus 425 bps to 450 bps guidance, and pricing on the second-lien term loan was trimmed to Libor plus 725 bps from talk of Libor plus 750 bps to 800 bps, the source said.

In addition, the original issue discount on the first-lien term loans finalized at 991/2, the tight end of the 99 to 99½ talk, and the discount on the second-lien loan tightened to 99 from talk of 98 to 981/2, the source continued.

Furthermore, the incremental allowance was increased to $90 million from $60 million, plus an unlimited amount subject to pro forma first-lien net leverage not to exceed 4 times.

As before, all of the term loans have a 1.25% Libor floor, the first-lien term loans have 101 soft call protection for one year, and the second-lien term loan has call protection of 103 in year one, 102 in year two and 101 in year three.

The company's $650 million senior secured credit facility also includes a $50 million five-year revolver (B1/B).

Recommitments are due by 5 p.m. ET on Wednesday.

Barclays, RBC Capital Markets, GE Capital Markets and Goldman Sachs & Co. are the lead banks on the deal.

Proceeds will be used to fund the acquisition of Par-Pak Ltd., a designer and manufacturer of rigid plastic packaging, and to refinance existing debt at both companies.

First-lien leverage is 4.2 times, up from 3.9 times under the original structure, and total leverage is 5.3 times, the source added.

Waddington is a Covington, Ky.-based manufacturer of disposable drinkware, dinnerware, servingware, cutlery and custom packaging.

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