Reynolds Group opts to lift euro term loan size to €300 million

By Sara Rosenberg

New York, Sept. 21 - Reynolds Group Holdings Ltd. increased its euro term loan (B1/B+) to €300 million from €250 million, according to a market source.

Pricing on the loan is Euribor plus 400 basis points after flexing earlier from Euribor plus 425 bps.

The company is also getting a $2,235,000,000 U.S. term loan (B1/B+) that is priced at Libor plus 375 bps after a recent flex down from Libor plus 425 bps that occurred when the tranche was downsized from $2,775,000,000.

Both term loans due September 2018 have a 25 bps pricing step-down at less than 5.5 times net leverage, have a 1% floor, were sold at par and include 101 repricing protection for one year.

Credit Suisse Securities (USA) LLC is the lead arranger and bookrunner on the roughly $2.6 billion deal, and HSBC Securities (USA) Inc. is a co-arranger.

Proceeds will be used to repay existing U.S. and euro term loans.

In addition, the company expects to repay some of its existing term loan borrowings with proceeds from a senior secured notes offering that was upsized to $3.25 billion from $1 billion. About $1.55 billion from the bonds will fund the paydown, about $1.2 billion will refinance 7¾% secured notes and about $500 million will add cash to the balance sheet.

The overall downsizing to the term loans was done as a result of the bond upsizing.

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

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