Nutrisystem ups spread on $557 million term B to Libor plus 625 bps

By Sara Rosenberg

New York, April 15 – Nutrisystem Inc. (KNS Acquisition Corp.) increased pricing on its $557 million six-year covenant-lite term loan B (B1/B) to Libor plus 625 basis points from revised talk of Libor plus 600 bps and initial talk of Libor plus 525 bps, according to a market source.

Furthermore, the original issue discount on the term loan was set at 97, the tight end of revised talk of 96 to 97 but wide of initial talk in the range of 98 to 98.5, the source said.

Also, the incremental/IED/ratio debt was changed to $50 million/35% of EBITDA from $75 million/50% of EBITDA, non-loan party investments were revised to $25 million/17% of EBITDA from $75 million/50% of EBITDA, and the general RDP basket was removed.

The term loan still has a 0.75% Libor floor, 101 soft call protection for one year and amortization of 2.5% per annum.

Earlier in syndication, a pricing step-down upon an initial public offering was removed from the term loan, the call protection was extended from six months, the maturity was shortened from seven years, amortization was increased from 1%, and documentation changes were made to, among other things, MFN, accordion, asset sale, excess cash flow sweep, general debt, EBITDA cost savings addback, and quarterly lender call requirement.

Deutsche Bank Securities Inc., Nomura, Jefferies LLC, BNP Paribas Securities Corp. and Rabobank are the bookrunners on the deal.

Recommitments were scheduled to be due at 4 p.m. ET on Thursday, the source added.

Proceeds will be used with a $100 million privately placed second-lien loan to fund the acquisition of Adaptive Health, a marketer and manufacturer of branded, condition-specific, science-backed nutritional supplements.

Nutrisystem is a Fort Washington, Pa.-based provider of weight loss and wellness programs.

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