Clean Harbors plans $475 million term loan, $375 million notes

By Sara Rosenberg

New York, Nov. 5 - Clean Harbors Inc. plans to get a $475 million seven-year covenant-light senior secured term loan and issue $375 million of unsecured notes for its acquisition of Safety-Kleen Inc., according to an 8-K/A filed with the Securities and Exchange Commission on Monday.

Goldman Sachs Bank USA is the lead bank on the deal.

Pricing on the term loan is expected at Libor plus 300 basis points with a 1% Libor floor, and there is 101 soft call protection for one year.

Amortization on the term loan is 1% per annum with the balance due at maturity.

As for the notes, they are backed by a commitment for a $375 million bridge loan that has pricing of Libor plus 450 bps with a 1% Libor floor. The spread will increase by 50 bps after three months and every three months thereafter up to a cap.

Under the agreement, Safety-Kleen, a Richardson, Texas-based re-refiner and recycler of used oil and a provider of parts cleaning and environmental services, is being purchased for $1.25 billion in cash from a group of investors including Highland Capital Management LP.

Other funds for the transaction can come from a $100 million revolver draw, cash on hand and/or the issuance of common stock.

Closing is expected by year-end, subject to U.S. and Canadian regulatory approvals and customary conditions

Clean Harbors is a Norwell, Mass.-based provider of environmental, energy and industrial services.

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