Advanced Drainage flexes $700 million term loan to Libor plus 225 bps

By Sara Rosenberg

New York, Sept. 18 – Advanced Drainage Systems Inc. reduced pricing on its $700 million seven-year first-lien term loan to Libor plus 225 basis points from talk in the range of Libor plus 275 bps to 300 bps, according to a market source.

Also, the original issue discount on the term loan was revised to 99.75 from 99, the source said.

The term loan still has a 0% Libor floor and 101 soft call protection for six months.

The company’s $1.05 billion of credit facilities (Ba1/BB) also includes a $350 million five-year revolver.

Barclays, Morgan Stanley Senior Funding Inc., BofA Securities, Inc., PNC Capital Markets, BMO Capital Markets, Fifth Third Bank and HSBC Securities (USA) Inc. are the joint lead arrangers on the deal.

Recommitments were scheduled to be due at noon ET on Wednesday, the source added.

Proceeds will be used to support the acquisition of Infiltrator Water Technologies Ultimate Holdings Inc. and to pay related fees and expenses.

Other funds for the transaction will come from $350 million of senior notes and a recently completed equity offering.

Infiltrator Water, an Old Saybrook, Conn.-based on-site septic wastewater treatment company, was bought on July 31 for about $1.08 billion from Ontario Teachers’ Pension Plan and other stockholders.

Advanced Drainage is a Hilliard, Ohio-based manufacturer of water management products and drainage solutions for use in the construction and infrastructure marketplace.

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