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Avery Dennison gets $800 million five-year loans at Libor plus 110 bps
By Susanna Moon
Chicago, Nov. 9 – Avery Dennison Corp. obtained $800 million of revolving loans in an amended five-year credit agreement Wednesday, according to an 8-K filing with the Securities and Exchange Commission.
Interest on the loans is initially Libor plus 110 basis points, with a facility fee of 15 bps. The spread ranges from Libor plus 91 bps to 137.5 bps based on the company’s debt ratings. The fee ranges from 9 bps to 25 bps.
Band of America Merrill Lynch, Citigroup Global Markets Inc. and JPMorgan Chase Bank, NA are the joint lead arrangers and joint bookrunners. Bank of America, NA is the administrative agent. Citibank, NA is the syndication agent, and JPMorgan Chase Bank, NA is the documentation agent.
The commitments may be increased by up to another $300 million.
The maturity date is November 8, 2022; however, the company may request that the commitments be extended for one-year periods under certain circumstances.
The loans may be prepaid without premium or penalty subject to breakage costs, and the commitments may be reduced or terminated.
The credit agreement requires the company to maintain a maximum leverage ratio of no more than 3.5 times; provided that, if an acquisition by the company that exceeds $250 million, the maximum leverage ratio will be increased to 3.75 times for the period of four consecutive fiscal quarters immediately following that acquisition. The minimum interest coverage ratio is 3.5 times.
Avery Dennison is a Pasadena, Calif.-based maker of pressure-sensitive materials, retail branding and information products and organization and identification products.
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