Sovos Brands tightens $100 million incremental term loan OID to 99.75

By Sara Rosenberg

New York, Oct. 22 – Sovos Brands Intermediate Inc. revised the original issue discount on its fungible $100 million incremental covenant-lite first-lien term loan due November 2025 to 99.75 from 99.5, according to a market source.

Pricing on the incremental term loan is Libor plus 500 basis points with a 25 bps step at 4.3x first-lien net leverage and a 0% Libor floor, in line with existing term loan pricing.

Amortization on the incremental term loan is 1% per annum.

Previously in syndication, the transaction was changed from a $380 million seven-year covenant-lite first-lien term loan talked at Libor plus 425 bps to 450 bps with a 0% Libor floor, an original issue discount of 99 and 101 soft call protection for six months, to the fungible add-on structure.

Credit Suisse Securities (USA) LLC is the left lead arranger on the deal.

Commitments were scheduled to be due at noon ET on Thursday, accelerated from 5 p.m. ET on Thursday, the source added.

Proceeds will be used to fund the acquisition of Birch Benders LLC, a Denver-based producer of pancake and waffle mixes, toaster waffles, and pancake and baking cups.

Prior to changing the structure of the deal, the company was planning on refinancing existing debt in addition to funding the acquisition.

Closing on the acquisition is expected by the end of this month.

Sovos, an Advent International portfolio company, is a Berkeley, Calif.-based food company.

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