Gates sets price talk on extended U.S. and euro term loans and add-on

By Sara Rosenberg

New York, March 17 – Gates Global LLC launched on Friday the extension by two years and eight months of its $1,949,000,000 term loan B to March 2024 with price talk of Libor plus 325 basis points with a 1% Libor floor and an original issue discount of 99.875, according to a market source.

The spread and floor on the extended U.S. term loan are unchanged from current pricing.

The company also launched its $300 million-equivalent euro add-on first-lien term loan B due March 2024 and extension by two years and eight months of its €193 million term loan B to March 2024 with price talk of Euribor plus 350 bps with a 0% floor and an original issue discount of 99.875 to par, the source said.

By comparison, current pricing on the euro term loan is Euribor plus 325 bps with a 1% floor.

All of the term debt is getting 101 soft call protection for six months.

Credit Suisse, Citigroup, Macquarie and Morgan Stanley are the bookrunners on the deal, with Credit Suisse the administrative agent.

Commitments are due at noon ET on March 29.

Proceeds from the add-on loan will be used to partially repay the existing first-lien term loan.

The company also intends to use proceeds from a $150 million add-on 6% senior unsecured notes offering to pay down U.S. term loan B debt due 2021.

As of Dec. 31, the U.S. term loan B totaled $2,398,700,000.

Gates is a Denver-based aftermarket-focused manufacturer of power transmission belts and fluid power products.

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