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MKS Instruments launches $800 million term B at Libor plus 450 bps
By Sara Rosenberg
New York, April 4 – MKS Instruments Inc. launched on Monday its $800 million seven-year covenant-light term loan B (BB) with price talk of Libor plus 450 basis points with a 0.75% Libor floor and an original issue discount of 98, according to a market source.
The term loan B has 101 soft call protection for six months, the source said.
Commitments are due by 5 p.m. ET on April 15.
The company’s $850 million senior secured credit facility also includes a $50 million five-year ABL revolver.
Barclays and Deutsche Bank Securities Inc. are the joint lead arrangers and bookrunners on the deal, with Barclays the left lead on the term loan and Deutsche Bank the left lead on the revolver.
Proceeds will be used to help fund the acquisition of Newport Corp. for $23.00 per share. The all-cash transaction is valued at about $980 million.
The combined company is expected to have around $1.4 billion in pro forma annual revenue, based on the two companies’ 2015 historical results.
Closing is expected in the second quarter, subject to regulatory approval and approval by Newport’s shareholders.
Total leverage is 2.5 times and net leverage is 1 time, the source added.
MKS is an Andover, Mass.-based provider of instruments, subsystems and process control solutions that measure, control, power, monitor and analyze critical parameters of advanced manufacturing processes. Newport is an Irvine, Calif.-based supplier of advanced-technology products and systems to customers in the scientific research, microelectronics, life and health sciences, industrial manufacturing and defense/security markets.
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