Heartland Dental sets $1.15 billion term loans at Libor plus 375 bps

By Sara Rosenberg

New York, April 19 – Heartland Dental LLC firmed pricing on its $1 billion seven-year covenant-light first-lien term loan and $150 million seven-year delayed-draw for two years covenant-light term loan at Libor plus 375 basis points, the high end of the Libor plus 350 bps to 375 bps talk, according to a market source.

Both term loans still have a 25 bps pricing step-down at 4.5 times first-lien net leverage, a 0% Libor floor and an original issue discount of 99.5.

Included in the term loan is 101 soft call protection for six months, and the delayed-draw term loan has a ticking fee of half the spread from days 31 to 60 and the full spread thereafter.

The company’s $1,285,000,000 of senior secured credit facilities (B2/B-) also provide for a $135 million revolver.

Jefferies LLC, KKR Capital Markets, TD Securities (USA) LLC, BMO Capital Markets and Macquarie Capital (USA) Inc. are the lead arrangers on the deal.

Proceeds will be used to help fund the buyout of the company by KKR from Ontario Teachers’ Pension Plan and other existing shareholders.

Closing is expected during the week of April 30.

Heartland Dental is an Effingham, Ill.-based dental support organization.

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