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Rexam Healthcare shifts funds between term loans, trims pricing
By Sara Rosenberg
New York, April 8 - Rexam Healthcare upsized its seven-year first-lien covenant-light term loan to $415 million from $380 million and downsized its eight-year second-lien covenant-light term loan to $140 million from $175 million, according to a market source.
The first-lien term loan is now split between a $315 million U.S. tranche and a $100 million euro equivalent tranche, revised from a $280 million U.S. tranche and $100 million euro equivalent tranche, the source said.
Also, pricing on the first-lien term loan was reduced to Libor/Euribor plus 325 basis points from talk of Libor/Euribor plus 375 bps to 400 bps, and pricing on the second-lien term loan was cut to Libor plus 700 bps from talk of Libor plus 775 bps to 800 bps.
Furthermore, the original issue discount on the first-lien term loan was changed to 99½ from 99, and the discount on the second-lien term loan was moved to 99 from 981/2, the source said.
Both term loans still have a 1% floor, the first-lien term loan still has 101 soft call protection for six months, and the second-lien term loan still has call protection of 102 in year one and 101 in year two.
The company's $620 million credit facility also includes a $65 million revolver.
Recommitments were due at 5 p.m. ET on Tuesday, the source added.
Credit Suisse Securities (USA) LLC, Morgan Stanley Senior Funding Inc., Barclays and HSBC Securities (USA) Inc. are the lead banks on the deal, with Credit Suisse the left lead on the first-lien loan and Morgan Stanley the left lead on the second-lien loan.
Proceeds will be used to help fund the buyout of the company by Montagu Private Equity from Rexam plc for $805 million.
Closing is expected by mid-year, subject to consultation with various European works councils and necessary regulatory approvals.
Rexam Healthcare is a manufacturer of plastic packaging for the health care industry.
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