Greif plans new term loans, senior notes for Caraustar purchase

By Sara Rosenberg

New York, Dec. 20 – Greif Inc. plans on getting additional term loans and issuing senior notes to fund its acquisition of Caraustar Industries Inc. from H.I.G. Capital for $1.8 billion, according to a company presentation.

Wells Fargo Bank, Goldman Sachs Bank USA and JPMorgan Chase Bank provided the financing commitments.

Backing the notes is a commitment for a bridge loan.

Leverage at closing is expected to be around 3.5 times. The company plans to return to somewhere in the range of 2 times to 2.5 times leverage within 36 to 48 months.

In conjunction with the acquisition, Greif intends to take out its existing 2019 senior notes.

Closing is expected in the first quarter of 2019, subject to customary conditions and regulatory approvals.

The combined company will have pro forma revenue of $5.3 billion and EBITDA of more than $720 million.

Greif is a Delaware, Ohio-based producer of industrial packaging products and services. Caraustar is an Austell, Ga.-based producer of uncoated recycled paperboard and coated recycled paperboard.

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