Masonite $1.525 billion credit facility anticipated to launch Feb. 7 week

By Sara Rosenberg

New York, Jan. 26 - Masonite International Corp. is now expecting to hold a bank meeting during the week of Feb. 7 to launch its proposed $1.525 billion credit facility, according to a market source.

The Bank of Nova Scotia is the administrative agent and left lead on the deal, but additional banks have been circled for agent roles as well.

The facility consists of a $350 million revolver and a $1.175 billion term loan B, with price talk on the tranches still unavailable at this time, the source said.

Previously it was thought that the deal could launch as early as January, although timing was and still is fluid, and details on the loan were hazier with the deal said to have an estimated size of about $1.5 billion consisting of a revolver and a term loan B in excess of $1 billion.

Proceeds will be used to help fund Kohlberg Kravis Roberts & Co.'s acquisition of Masonite in an all cash transaction under which Masonite's shareholders will receive C$40.20 per share. The total value of the transaction is about C$3.1 billion.

The Mississauga, Ont.-based building products company will also be approaching the high-yield market as part of the leveraged buyout financing package, probably in February as well, with about $825 million of bonds that could come in a multi-tranche offering, the source added.

KKR will be providing some equity to fund the acquisition as well.

Both the loan and the bonds are expected to be done in U.S. currency, not Canadian dollars.

Closing of the LBO is subject to customary conditions, including regulatory, shareholder and court approvals.

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