Owens-Brockway finalizes $750 million term B at Libor plus 275 bps

By Sara Rosenberg

New York, Aug. 13 – Owens-Brockway Glass Container Inc. (Owens-Illinois Inc.) firmed pricing on its $750 million seven-year covenant-light term loan B at Libor plus 275 basis points, the low end of the Libor plus 275 bps to 300 bps talk, according to a market source.

Furthermore, the original issue discount on the term loan B was tightened to 99.75 from 99.5, the source said.

The B loan still has a 0.75% Libor floor and 101 soft call protection for six months.

Along with the term loan B, the company is getting a $500 million term loan A due April 2020 that is priced at Libor plus 175 bps with a 25 bps upfront fee.

The term loan A has a total net leverage covenant.

Deutsche Bank Securities Inc., Bank of America Merrill Lynch, BNP Paribas Securities Corp., Credit Agricole Securities (USA) Inc., Goldman Sachs Bank USA, J.P. Morgan Securities LLC, Scotiabank, Barclays, Rabobank and HSBC Securities (USA) Inc. are the bookrunners on the $1.25 billion of term loans (Baa3/BBB).

Proceeds will be used to help fund the acquisition of Vitro, SAB de CV’s food and beverage glass container business in an all-cash transaction valued at about $2.15 billion.

Other funds for the transaction will come from $1 billion of senior notes.

Closing is subject to approval by Vitro’s shareholders and customary regulatory approvals.

Owens-Brockway is a Perrysburg, Ohio-based glass container manufacturer.

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