Summit Materials talks $650 million term B at Libor plus 325-350 bps

By Sara Rosenberg

New York, June 19 – Summit Materials LLC launched on Friday its $650 million seven-year covenant-light term loan B with price talk of Libor plus 325 basis points to 350 bps with a 1% Libor floor and an original issue discount of 99.5, according to a market source.

The term loan has 101 soft call protection for six months, the source said.

Commitments are due on June 25.

Bank of America Merrill Lynch, Deutsche Bank Securities Inc., Goldman Sachs Bank USA, Citigroup Global Markets Inc., Barclays and RBC Capital Markets LLC 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.

© 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.