Four Seasons finalizes $850 million term loan B at 98.5 OID

By Sara Rosenberg

New York, Nov. 17 – Four Seasons Hotels and Resorts firmed the original issue discount on its $850 million seven-year senior secured first-lien term loan B (Ba3/BB+) at 98.5, the tight end of revised talk of 98 to 98.5 and tighter than initial talk of 97, according to a market source.

Pricing on the term loan is SOFR+10 basis points CSA plus 325 bps with a 0.5% floor.

Earlier in syndication, pricing on the term loan was set at the low end of the SOFR plus 325 bps to 350 bps talk.

The term loan has 101 soft call protection for six months and amortization of 1% per annum.

Mandatory prepayments are from 50% of excess cash flow, subject to leverage-based step-downs, 100% of asset sale proceeds, subject to reinvestment rights, and 100% of debt issuance proceeds, subject to customary baskets.

Security is a first priority pledge on the accounts receivable, inter-company debt receivables and intellectual property of Four Seasons Hotels Ltd., and the capital stock of the borrowers, the guarantors and certain other entities but excluding the capital stock of Four Seasons Holdings Inc. and Dragonfire Holding Ltd., subject to customary exceptions.

Citigroup Global Markets Inc. and Morgan Stanley Senior Funding Inc. are the joint lead arrangers on the deal. Citigroup is the administrative agent.

Proceeds will be used to refinance an existing senior secured first-lien term loan due November 2023 and pay related fees and expenses.

Closing is expected on Nov. 30.

Four Seasons is a Toronto-based luxury hotels company.

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