IPS discloses revisions on first- and second-lien term loans

By Sara Rosenberg

New York, Dec. 6 – IPS Corp. increased pricing on its $310 million seven-year first-lien term loan to Libor plus 525 basis points from talk of Libor plus 450 bps to 475 bps and on its eight-year second-lien term loan to Libor plus 950 bps from talk of Libor plus 875 bps to 900 bps, according to a market source.

In addition, the second-lien term loan was downsized to $100 million from $110 million and the call protection was changed to 103 in year one, 102 in year two and 101 in year three from 102 in year one and 101 in year two.

Also, the original issue discount on the first-lien term loan was revised to 98.5 from 99, the source said.

Furthermore, a fixed leverage covenant set at a 40% cushion to closing leverage was added to the originally covenant-light loans, the source continued.

Both term loans still have a 1% Libor floor, the first-lien term loan still has 101 soft call protection for six months and the second-lien term loan still has an original issue discount of 98.

The company’s now $445 million credit facility, down from $455 million, also provides for a $35 million ABL revolver.

Jefferies Finance LLC is the lead on the deal.

Commitments are due at 5 p.m. ET on Wednesday, the source added.

Proceeds will be used to refinance existing debt and fund a dividend.

IPS, a portfolio company of Nautic Partners LLC, is a Compton, Calif.-based manufacturer of solvent cements, primers and sealants, plumbing and roofing products, and structural and assembly adhesives.

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