Hillman Group launches $610 million term loan at Libor plus 375 bps

By Sara Rosenberg

New York, June 2 - Hillman Group Inc. launched on Monday its $610 million seven-year covenant-light term loan B with price talk of Libor plus 375 basis points with a 1% Libor floor and an original issue discount of 99, according to a market source.

The term loan has 101 soft call protection for one year, the source said.

The company's $680 million senior secured credit facility (B1) also includes a $70 million five-year revolver.

Commitments are due on June 12, the source added.

Barclays, Morgan Stanley Senior Funding Inc. and GE Capital Markets are the bookrunners on the deal.

Proceeds will be used to help fund the $1,475,000,000 buyout of the company by CCMP Capital Advisors LLC from Oak Hill Capital Partners.

Other funds for the transaction will come from $270 million of eight-year senior unsecured notes and about $545 million of equity.

Backing the bonds is a commitment for a $270 million senior unsecured bridge loan.

In connection with the transaction, Hillman's secured credit facility, under which about $384 million is outstanding, will be repaid, and its 10 7/8% senior notes due 2018 will be redeemed.

Senior secured leverage is 4.6 times and total opco leverage is 6.5 times.

Closing is expected this quarter or next quarter, subject to regulatory approvals and customary conditions.

Following completion of the buyout, Oak Hill Capital and its affiliates will retain a significant minority interest in the company.

Hillman is a Cincinnati-based distributor of fasteners, key duplication systems, engraved tags and related hardware items.

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