Diversey to repay term loans, $3.7 million LoC under merger plans

By Susanna Moon

Chicago, Aug. 8 - Diversey Inc.'s senior secured credit facilities will be paid off by Sealed Air Corp. under their merger agreement, according to a 10-Q filed with the Securities and Exchange Commission on Monday.

The company received net proceeds of $985 million under the term loans due Nov. 24, 2015 and has $3.7 million in letters of credit outstanding under the revolving loan facility due Nov. 24, 2014.

Sealed Air also plans to redeem Diversey Inc.'s $400 million principal amount of 8¼% senior notes due 2019 and Diversey Holdings, Inc.'s $262.5 million principal amount of 10½% senior notes due 2020.

As of July 1, Diversey Inc. reported total debt of $1.28 billion, consisting of $400 million of senior notes, $843.1 million of borrowings under the senior secured credit facilities and $40 million of other short-term credit lines.

In addition, the company had $173.6 million of operating lease commitments and $1.4 million of capital lease commitments.

After the extinguishment of the debt, the company expects to write off unamortized discounts of $12.7 million and capitalized debt issuance costs of $50 million as of July 1.

Sealed Air said on June 1 that it received a commitment from Citi to structure $4.5 billion of financing related to the acquisition.

Among the financing is a $3 billion credit facility that includes a $700 revolver, a $1 billion term loan A and a $1.3 billion term loan B.

Diversey Inc. is a Sturtevant, Wis.-based maker of commercial cleaning, sanitation and hygiene products. The company is a wholly owned subsidiary of Diversey Holdings.

Sealed Air is an Elmwood Park, N.J.-based manufacturer of materials and systems for protective, presentation and fresh food packaging and performance solutions in the industrial, food and consumer markets.

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