AOT Bedding talks $1.2 billion term loan at Libor plus 425-450 bps

By Sara Rosenberg

New York, Sept. 6 - AOT Bedding Super Holdings LLC launched its $1,233,000,000 seven-year senior secured term loan on Thursday with price talk of Libor plus 425 basis points to 450 bps with a 1.25% Libor floor and an original issue discount of 99, according to a market source.

Commitments are due on Sept. 19, the source said.

The company's $1,458,000,000 credit facility also includes a $225 million ABL revolver.

Morgan Stanley Senior Funding Inc., Goldman Sachs & Co., UBS Securities LLC, Deutsche Bank Securities Inc. and Barclays are the bookrunners on the deal and joint lead arrangers with Jefferies & Co. and RBC Capital Markets LLC.

Proceeds will be used to help fund the acquisition of the company by Advent International and to refinance existing debt.

Other funds for the transaction will come from $725 million of high-yield bonds, for which Goldman Sachs is the left lead.

Under the agreement, mattress manufacturer AOT, the parent company of Hoffman Estates, Ill.-based National Bedding Co. and Atlanta-based Simmons Bedding Co., is being purchased from Ares Management LLC and the Ontario Teachers' Pension Plan.

However, Ares and Ontario Teachers' will retain a significant equity stake in the company.

Closing is expected in the fourth quarter, subject to conditions.

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