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Howden reduces term loan B to $900 million, widens price talk
By Sara Rosenberg
New York, Sept. 24 – Howden downsized its covenant-lite term loan B to $900 million from $925 million and increased price talk to a range of Libor plus 500 basis points to 525 bps from a range of Libor plus 425 bps to 450 bps, according to a market source.
Additionally, the original issue discount on the term loan was modified to 97 from 99 and the 101 soft call protection was extended to one year from six months, the source said.
Also, the company revised MFN, incremental, excess cash flow sweep, restricted payments and EBITDA definitions.
The term loan still has a 0% Libor floor.
The company’s now $1.325 billion of credit facilities, down from $1.35 billion, also include a $150 million revolver and a $275 million letter of credit facility.
J.P. Morgan Securities LLC, Barclays, BNP Paribas Securities Corp., RBC Capital Markets and HSBC Securities (USA) Inc. provided the debt commitment.
Commitments are due at noon ET on Wednesday, the source added.
Proceeds will be used to help fund the buyout of the company by KPS Capital Partners LP from Colfax Corp. for $1.8 billion, including $1.66 billion in cash consideration and $140 million in assumed liabilities and minority interest.
Other funds for the transaction will come from $300 million of senior notes and equity.
To compensate for the smaller term loan B, the company will draw on its revolver.
Closing is expected in the second half of this year, subject to customary conditions and approvals.
Howden is a Glasgow, Scotland-based provider of mission critical air and gas handling products and services to the industrial, power, oil & gas and mining industries.
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