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Owens-Brockway shifts funds between term loans, updates term B pricing
By Sara Rosenberg
New York, Aug. 13 – Owens-Brockway Glass Container Inc. (Owens-Illinois Inc.) downsized its seven-year covenant-light term loan to $575 million from $750 million and upsized its term loan A due April 2020 to $675 million from $500 million, according to a market source.
Also, pricing on the term loan B firmed at Libor plus 275 basis points, the low end of the Libor plus 275 bps to 300 bps talk, and the original issue discount 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.
Pricing on the term loan A remained at Libor plus 175 bps with a 25 bps upfront fee.
The term loan A has a total net leverage covenant.
Ticking fees are half the spread from days 31 to 60 and the full spread plus floor thereafter on the term loan B and 30 bps per annum on the term loan A, the source continued.
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 in 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 in senior notes.
Closing is subject to approval by Vitro’s shareholders and customary regulatory approvals.
Closing is required by May 12, 2016 or the loan commitments will fall away, the source added.
Owens-Brockway is a Perrysburg, Ohio-based glass container manufacturer.
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