Summit Materials to launch $650 million term loan B on Friday

By Sara Rosenberg

New York, June 18 – Summit Materials LLC is set to hold a lender call at 10 a.m. ET on Friday to launch a $650 million seven-year covenant-light term loan B, according to a market source.

Bank of America Merrill Lynch, Deutsche Bank Securities Inc., Goldman Sachs Bank USA, Citigroup Global Markets Inc., Barclays and RBC Capital Markets are the arrangers on the deal. Blackstone is a co-manager.

Proceeds will be used to help fund the acquisition of a 1.2 million short ton capacity cement plant in Davenport, Iowa, and seven cement distribution terminals from Lafarge North America, refinance an existing term loan B due 2019 and repay a portion of the existing senior notes due 2020.

Other funds for the transaction will come from $275 million of senior unsecured notes and an $80 million equity raise.

The purchase price for the assets is $450 million, with $370 million due at closing and $80 million due no later than Dec. 31, 2015.

Closing on the acquisition is expected in July, subject to final regulatory approval and the Lafarge-Holcim merger closing.

Pro forma for the completion of the acquisition, secured net leverage will be 2.5 times and total net leverage will be 4.6 times.

Summit is a Denver-based construction materials company.

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