Reynolds Group updates spreads, OIDs on U.S. and euro term loans

By Sara Rosenberg

New York, July 20 – Reynolds Group Holdings Inc. set pricing on its $1,973,000,000 6.5-year term loan at Libor plus 325 basis points with a step-down if corporate ratings are B2/B or better, versus initial talk of Libor plus 325 bps to 350 bps, according to a market source.

Also, pricing on the company’s €250 million 6.5-year term loan firmed at Euribor plus 375 bps, the low end of the Euribor plus 375 bps to 400 bps talk, the source said.

In addition, the original issue discount on the U.S. term loan was tightened to 99.75 from 99.5 and the discount on the euro term loan was revised to 99.75 from 99.

As before, the U.S. term loan has a 1% Libor floor, the euro term loan has no floor, and both term loans have 101 soft call protection for six months.

Commitments were scheduled to be due at 2 p.m. ET on Wednesday, the source added.

At the start of the week, the company had downsized its U.S. dollar term loan from $2,223,000,000 with the funds replaced by a $250 million 5 1/8% add-on senior secured notes offering that priced at 103.5 to yield 4.331%.

Credit Suisse Securities (USA) LLC and HSBC Securities (USA) Inc. are the leads on the deal.

Proceeds will be used to refinance existing term loans.

Furthermore, the company said in a news release last week that it is looking to resize its revolver as a single $400 million facility and extend the maturity to five years from closing.

Reynolds Group is an Auckland, New Zealand-based manufacturer and supplier of consumer food and beverage packaging and storage products.

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