Heartland Dental updates first- and second-lien term loan pricing

By Sara Rosenberg

New York, July 28 – Heartland Dental LLC set pricing on its $750 million six-year covenant-light first-lien term loan (B2/B-) at Libor plus 475 basis points, the high end of the Libor plus 450 bps to 475 bps talk, according to a market source.

Also, the 101 soft call protection on the first-lien term loan was extended to one year from six months, the source said.

Furthermore, the company revised the original issue discount on its $225 million seven-year covenant-light second-lien term loan (Caa2/CCC) to 98.5 from 99, the source continued.

As before, the first-lien term loan has a 1% Libor floor, an original issue discount of 99.5 and amortization of 1% per annum, and the second-lien term loan is priced at Libor plus 850 bps with a 1% Libor floor and has call protection of 102 in year one and 101 in year two.

The company’s $1,075,000,000 of credit facilities also include a $100 million revolver (B2/B-).

BMO Capital Markets, Barclays, Morgan Stanley Senior Funding Inc. and KKR Capital Markets are the bookrunners on the deal.

Proceeds will be used to refinance existing debt and to pay related fees and expenses.

Closing is expected on Monday, the source added.

Heartland Dental is an Effingham, Ill.-based dental support organization that is majority-owned by Ontario Teachers’ Pension Plan.

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