High Liner Foods prices $250 million Libor plus 550 bps term loan at 98

By Paul A. Harris

Portland, Ore., Dec. 20 - High Liner Foods Inc. priced its $250 million Libor plus 550 basis points term loan B (B2/B) at 98 on Tuesday, according to an informed source.

The deal allocated and broke to 98½ bid.

The loan features a 1.5% Libor floor and has 101 soft call protection for one year.

RBC Capital Markets and BMO Capital Markets are the lead banks on the deal.

Proceeds will be used to help fund the $230.6 million acquisition of Icelandic Group's U.S. subsidiary and Asian procurement operations and to repay an existing roughly $47 million term loan.

As part of the transaction, the company plans on increasing its existing asset-based credit facility to $180 million from $120 million.

Closing is anticipated to occur late this year or during the first quarter of 2012, subject to customary conditions, including regulatory approvals.

Near-term synergies are expected at $12.1 million, and total ongoing annual synergies are expected to be in the range of $16 million to $18 million.

The company previously said that leverage would be reduced to about 3.8 times on a pro forma basis adjusted for the expected near-term synergies and seasonal debt levels.

In addition, the company's annual revenue on a pro forma basis would be about $900 million for the last 12 months ending September 2011 with pro forma-adjusted EBITDA of about $94 million, including near-term synergies.

High Liner is a Lunenburg, N.S.-based frozen seafood company. Icelandic's U.S. subsidiary is a supplier of seafood to the U.S. food service market.

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