NEP Group moves funds between first- and second-lien term loans

By Sara Rosenberg

New York, Oct. 4 – NEP Group Inc. upsized its U.S. seven-year first-lien term loan to $1.13 billion from $1.04 billion and downsized its eight-year second-lien term loan to $240 million from $330 million, according to a market source.

Also, pricing on the U.S. first-lien term loan was changed to Libor plus 325 basis points from Libor plus 350 bps and a step-down was added to Libor plus 300 bps at 4 times first-lien net leverage, and pricing on the second-lien term loan was revised to Libor plus 700 bps from Libor plus 750 bps, the source said.

Additionally, the company lowered pricing on its €397.1 million seven-year first-lien term loan to Euribor plus 350 bps from Euribor plus 375 bps and added a step-down to Euribor plus 325 bps at 4 times first-lien net leverage.

Furthermore, the original issue discount on the U.S. first-lien term loan was tightened to 99.75 from 99.5, the discount talk on the euro first-lien term loan was changed to a range of 99.75 to par from 99.5, and the discount on the second-lien term loan was modified to 99.5 from 99.

All of the term loans still have a 0% floor, the first-lien term loans still have 101 soft call protection for six months, and the second-lien term loan still has call protection of 102 in year one and 101 in year two.

Barclays and J.P. Morgan Securities LLC are the bookrunners on the deal, with Barclays the left lead on the first-lien tranches and JPMorgan the left lead on the second-lien loan.

Commitments for the U.S. debt are due at 10 a.m. ET on Friday and commitments for the euro debt are due at 8 a.m. ET on Friday, with allocations thereafter, the source added.

Proceeds will be used to help fund Carlyle’s majority investment in the company and to refinance existing debt.

With the loan changes, it was revealed that Carlyle will contribute an incremental $35 million of equity in the form of cash to the balance sheet, to be used for general corporate purposes.

NEP is a Pittsburgh-based provider of outsourced live and broadcast production solutions.

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