dj Orthopedics plans $410 million facility for Aircast purchase

By Sara Rosenberg

New York, Feb. 27 - dj Orthopedics Inc. has received a commitment for a $410 million credit facility in connection with its acquisition of Aircast Inc. from Tailwind Capital, company officials said in a conference call Monday.

Wachovia is the lead bank on the deal.

The facility is expected to consist of a $360 million seven-year term loan and a $50 million revolver, officials said in the call.

Proceeds from the term loan will be used to fund the about $290 million cash purchase price for Aircast and to repay dj Orthopedics' existing bank debt.

The revolver is expected to be undrawn at closing.

Company officials declined to disclose expected interest rates on the new bank financing. The company's current credit facility carries an interest rate of Libor plus 125 basis points, "but we're adding leverage with the transaction," officials added in the call.

Leverage at closing will be just under 4 times trailing latest 12-month EBITDA, but the company plans to rapidly repay the debt using excess cash flow.

The transaction is expected to be completed as early as March 30, subject to customary governmental approvals and closing conditions.

dj Orthopedics is a Vista, Calif., medical device company specializing in rehabilitation and regeneration products for the non-operative orthopedic and spine markets. Aircast is a Summit, N.J., designer and manufacturer of orthopedic devices, including ankle bracing products and vascular systems.

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