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Entegris gets $4 billion term loan, $895 million bridge commitment
By Sara Rosenberg
New York, Dec. 16 – Entegris Inc. has received a commitment for an up to $4 billion senior secured first-lien term loan B and an up to $895 million 364-day senior unsecured bridge loan in connection with its acquisition of CMC Materials Inc., according to an 8-K filed with the Securities and Exchange Commission on Thursday.
Morgan Stanley Senior Funding Inc. provided the debt commitment.
Under the agreement, CMC Materials is being bought for $133.00 in cash and 0.4506 shares of Entegris common stock for each share of CMC Materials common stock they own. The transaction has an enterprise value of about $6.5 billion.
The new debt will be used with cash on hand to fund the cash portion of the purchase price, refinance certain CMC and Entegris debt, and fund working capital and general corporate purposes.
Upon completion, Entegris shareholders will own around 91% of the combined company and CMC Materials shareholders will own about 9%.
Pro forma adjusted gross leverage is expected to be about 4x at closing. The company believes it will be well positioned to rapidly reduce its leverage to less than 3x with roughly $1.1 billion in adjusted EBITDA on a pro forma LTM basis including synergies.
Closing is anticipated in the second half of 2022, subject to customary conditions, including regulatory approvals and approval by CMC Materials shareholders.
Entegris is a Billerica, Mass.-based supplier of advanced materials and process solutions for the semiconductor and other high-technology industries. CMC Materials is an Aurora, Ill.-based supplier of advanced materials primarily for the semiconductor industry.
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