Steinway Musical to launch $290 million of term loans on Wednesday

By Sara Rosenberg

New York, Sept. 3 - Steinway Musical Instruments Inc. set a conference call for 10 a.m. ET on Wednesday to launch $290 million of first-and second-lien term loans, according to a market source.

Bank of America Merrill Lynch and Deutsche Bank Securities Inc. are the lead banks on the debt.

The debt consists of a $190 million six-year first-lien term loan (B1) and a $100 million seven-year second-lien term loan (Caa1), the source said.

Based on filings with the Securities and Exchange Commission, the first-lien term loan is expected to be priced at Libor plus 450 basis points with a 1% Libor floor and have 101 soft call protection for one year, and the second-lien term loan is expected to be Libor plus 850 bps with a 1% Libor floor and have call protection of 103 in year one, 102 in year two and 101 in year three.

The filings also said that the company would be getting a $75 million five-year asset-based revolver with pricing of Libor plus 175 bps with a 37.5 bps unused fee.

Proceeds will be used to help fund the buyout of the company by Paulson & Co. Inc. for $40 per share, or about $512 million.

Other funds for the transaction will come from around $225 million of equity.

Closing is expected in late September, subject to customary conditions, including the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act and receipt of German antitrust approvals. The offer is not subject to a financing condition.

Steinway is a Waltham, Mass.-based musical instruments company.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.