Hostess closes up to $100 million four-year revolver via Credit Suisse

By Tali Rackner

Norfolk, Va., Nov. 22 – HB Holdings, LLC and Hostess Brands, LLC entered into an amended and restated first-lien credit agreement on Friday that provides for up to $100 million in revolving loans, according to an 8-K filing with the Securities and Exchange Commission.

Credit Suisse AG, Cayman Islands branch is the administrative agent.

The agreement matures on Aug. 3, 2020.

Interest on revolving borrowings is equal to Libor plus 300 basis points to 350 bps, depending on the net first-lien leverage ratio. Initial interest is Libor plus 350 bps.

The commitment fee ranges from 37.5 bps to 50 bps, based on the unused portion of the commitments. The initial fee is 50 bps.

The credit agreement also includes $998.75 million in term loans.

Certain financial covenants require Hostess to maintain a maximum net first-lien leverage ratio of 7.3 times on the last day of any fiscal quarter on which the aggregate amount of outstanding revolving loans (excluding letters of credit) on such date exceeds an amount equal to 30% of the then-outstanding commitments with respect to the revolving loans.

Proceeds will be used for general corporate purposes.

Credit Suisse Securities (USA) LLC, UBS Securities LLC, RBC Capital Markets LLC, Morgan Stanley Senior Funding, Inc. and Deutsche Bank Securities Inc. are the joint lead arrangers and bookrunners on the deal.

Hostess is a Kansas City, Mo.-based sweet baked goods company.

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