Confie Seguros lifts first-lien loan to $665 million, raises pricing

By Sara Rosenberg

New York, Oct. 11 – Confie Seguros Holding II Co. upsized its 5.5-year first-lien term loan B (B2/B) to $665 million from $590 million and increased pricing to Libor plus 475 basis points from talk of Libor plus 425 bps to 450 bps, according to a market source.

In addition, the 101 soft call protection was extended to one year from six months and the MFN sunset was removed, the source said.

Also, a springing maturity was added to the term loan B to six months ahead of the second-lien term loan if the second-lien loan is still outstanding by November 2018, the first-lien incremental unlimited prong was revised to 4.25 times first-lien net leverage from 4 times, and the financial covenant was set at 5.75 times with a step-down to 5.5 times after 18 months, the source continued.

As before, the term loan B has a 1% Libor floor and an original issue discount of 99.

RBC Capital Markets LLC, Antares, Goldman Sachs Bank USA and Barclays are the joint lead arrangers on the deal.

Recommitments are due at noon ET on Thursday.

Proceeds will be used to refinance an existing $547.6 million first-lien term loan and an $89.8 million first-lien term loan B-1, to repay $15.3 million in revolver borrowings and to pay fees and expenses.

Initially the company was also planning on refinancing its existing $261.4 million second-lien term loan and issuing $350 million in six-year unsecured notes to help with the refinancing. However, the decision was made not to proceed with the opportunistic bond given a less attractive rate dynamic than anticipated coupled with the 101 prepayment penalty on the second-lien loan, the source added.

The junior capital refinancing will be executed separately at a later date.

First-lien leverage is 4.5 times, and total leverage is 6.2 times.

Confie Seguros, an ABRY Partners portfolio company, is a Buena Park, Calif.-based personal lines insurance broker.

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