Rockwood Specialties $535 million loan to launch next week

By Sara Rosenberg

New York, June 26 - Rockwood Specialties Group Inc. is scheduled to hold a bank meeting next week for a new $535 million senior secured credit facility, a source close to the deal told Prospect News on Thursday. JPMorgan, Merrill Lynch and Goldman Sachs are leading the deal.

The facility consists of a $100 million six-year revolver, a $100 million six-year term loan A and a $335 million seven-year term loan B, the source said.

The Princeton, N.J. chemical company is seeking this new credit facility as part of a recapitalization plan that also includes the issuance of $375 million senior subordinated notes due 2011 and a $25 million equity infusion from Kohlberg Kravis Roberts & Co. This new capital structure of bank debt, bonds and equity will replace the existing capital structure, which consists of only bank and bond debt, the source said.

"The timing is good. The market is receptive to these types of high yield deals. It gives a lot more flexibility and breathing room in terms of covenants," the source said in explanation of why the recapitalization plan is currently being sought after.

Closing on both the credit facility and the bond offering is expected to occur around July 23.

Standard & Poor's rated the credit facility at B+. Moody's Investors Service rated the deal B1.

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