Allen-Vanguard launches C$250 million credit facility

By Sara Rosenberg

New York, April 1 - Allen-Vanguard Corp. held a bank meeting on Tuesday in Toronto to launch its proposed C$250 million three-year secured credit facility, according to a market source.

RBC Capital Markets is the lead bank on the deal that is being targeted at commercial banks.

The facility consists of a C$200 million term loan and a C$50 million revolver, with both tranches talked in the Libor plus mid-300 basis points range, the source said.

Both the revolver and the term loan are available in U.S. dollars.

The term loan will be repayable in quarterly principal payments of C$10 million, plus additional quarterly payments ranging from 50% to 75% of excess cash flow, with any remaining principal repayable upon the maturity date.

Proceeds will be used to repay the company's existing higher-cost senior debt facilities, expected to be about C$180 million, plus a prepayment penalty equal to 5% of the outstanding balance.

Leverage is less than 2.0 times.

Commitments are due on April 18 and the deal is expected to close by April 25.

Allen-Vanguard is an Ottawa, Can.-based provider of proprietary counter-terrorist equipment systems for defeating and mitigating conventional and unconventional terrorist devices of all kinds.

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