Tomkins ups term loan B to $1.7 billion, cancels $600 million notes

By Sara Rosenberg

New York, Sept. 16 - Tomkins plc increased the size of its six-year term loan B to $1.7 billion from $1 billion and eliminated plans for a $600 million secured bond offering, according to sources.

As before, the company's credit facility (Ba2) also includes a $300 million revolver and a $300 million term loan A, but as a result of the term loan B upsizing, the amount drawn under the revolver at close is being reduced by $100 million, sources said.

Price talk on the term loan B remained at Libor plus 475 basis points with a 1.75% Libor floor and an original issue discount of 98 to 99.

Citigroup and Bank of America are the lead arrangers and joint bookrunners on the now $2.3 billion deal, with Barclays Capital, RBC Capital Markets and UBS bookrunners as well.

Proceeds will be used to help fund the acquisition of the company by Pinafore Acquisitions Ltd., a company jointly owned by Onex Corp. and Canada Pension Plan Investment Board, for 325p per share in cash.

The acquisition values Tomkins' existing issued and to-be-issued share capital at £2.89 billion.

Other funding for the transaction will come from $1 billion of second-lien bonds and about $2.2 billion of equity.

Closing is expected to take place on Sept. 24.

Tomkins is a London-based engineering and manufacturing group providing products for the industrial, automotive and building products markets.

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