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Schrader sets talk on first- and second-lien term loans with launch
By Sara Rosenberg
New York, April 10 - Schrader released price talk on its $230 million first-lien term loan (B1/B) and $100 million second-lien term loan (Caa1/B-) as the debt launched with a bank meeting on Tuesday morning, according to a market source.
The first-lien term loan is talked at Libor plus 450 basis points to 475 bps and the second-lien term loan is talked at Libor plus 850 bps to 900 bps, with both tranches having a 1.25% Libor floor, the source said.
Original issue discount talk on the first-lien term loan is 98½ and on the second-lien term loan is 98, the source continued.
There is 101 soft call protection for one year on the first-lien term loan, and the second-lien loan has hard call protection of 103 in year one, 102 in year two and 101 in year three, the source added.
The company's $365 million credit facility also includes a $35 million revolver (B1/B).
Commitments are due on April 24.
Barclays Capital Inc., Goldman Sachs & Co. and Citigroup Global Markets Inc. are the lead banks on the deal, with Barclays the left lead.
Proceeds will be used to help fund the buyout of the company by Madison Dearborn Partners LLC from Tomkins for $505 million in cash plus a small minority equity interest in the parent of the purchasing company.
Other funds for the transaction will come from equity.
Leverage is around 3.1 times through the first-lien and 4.4 times total.
Closing is expected in the second quarter, subject to customary conditions.
For fiscal year 2011, Schrader had revenue of about $451 million and adjusted EBITDA of around $76 million.
Schrader is a manufacturer of tire pressure monitoring systems, valve products and tire hardware and related accessories for both original equipment manufacturers and aftermarket customers.
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