Coinstar raises first-lien term loan to $560 million, updates pricing

By Sara Rosenberg

New York, Sept. 23 – Coinstar LLC upsized its seven-year covenant-light first-lien term loan to $560 million from $535 million and firmed pricing at Libor plus 425 basis points, the low end of the Libor plus 425 bps to 450 bps talk, according to a market source.

Furthermore, the original issue discount on the first-lien loan was changed to 99.5 from 99, the source said.

The first-lien term loan still has a 1% Libor floor and 101 soft call protection for six months.

The company’s now $770 million senior secured credit facility, up from $745 million, also includes a $75 million five-year revolver and a $135 million eight-year covenant-light second-lien term loan.

Pricing on the second-lien term loan is Libor plus 875 bps with a 1% Libor floor and a discount of 98.5, and the debt has hard call protection of 102 in year one and 101 in year two.

Bank of America Merrill Lynch, Jefferies Finance LLC, Credit Suisse Securities (USA) LLC, Barclays and Deutsche Bank Securities Inc. are the joint lead arrangers on the deal.

Proceeds will be used to back the buyout of Coinstar’s parent company, Bellevue, Wash.-based Outerwall Inc., by Apollo Global Management LLC for $52.00 per share in cash. The transaction has a total enterprise value of about $1.6 billion, including net debt.

The funds from the first-lien term loan upsizing will be used to reduce the equity component of the buyout transaction, the source added.

Closing is expected during the third quarter, subject to satisfaction of a minimum tender condition, the receipt of regulatory approvals and other customary conditions.

Coinstar is a fully automated network of self-service coin-counting machines.

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