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Avantor reworks first-, second-lien loan tranching, updates pricing
By Sara Rosenberg
New York, March 7 – Avantor Performance Materials Holdings Inc. upsized its seven-year covenant-light first-lien term loan to $1,485,000,000 from $1,425,000,000 with the addition of a $60 million delayed-draw tranche, and upsized its eight-year covenant-light second-lien term loan to $475 million from $380 million, of which $20 million is a new delayed-draw tranche, according to a market source.
Also, pricing on the first-lien term loan was reduced to Libor plus 400 basis points from Libor plus 425 bps and a 25 bps step-down was added at 5.25 times total net leverage, the source said.
In addition, the original issue discount on the second-lien term loan was revised to 99 from 98.5.
The first-lien term loan still has a 1% Libor floor, an original issue discount of 99.75 on new money and a par issue price on rollover money and 101 soft call protection for six months.
Pricing on the second-lien term loan remained at Libor plus 825 bps with a 1% Libor floor, and the debt still has hard call protection of 102 in year one and 101 in year two.
The company’s now $2,035,000,000 credit facility, up from $1.88 billion, also includes a $75 million five-year revolver.
Jefferies Finance LLC is the lead on the deal.
Recommitments were scheduled to be due at 5 p.m. ET on Tuesday, the source continued.
Proceeds will be used to refinance existing debt and fund a dividend, and the delayed-draw debt will be used to fund an acquisition.
The size of the dividend was increased with the upsizing to the funded amount of second-lien term loan borrowings, the source added.
With this transaction, existing first-lien term loan lenders are being paid out at a premium of 101.
Avantor is a Center Valley, Pa.-based provider of performance materials and solutions for the life sciences and advanced technology markets.
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