Targus shifts $150 million proposed bond financing to bank loan, PIK notes

By Paul A. Harris

St. Louis, Nov. 15 - Laptop computer case and accessories-maker Targus Group International Inc. has shifted $150 million of its leveraged buyout financing to the bank loan market from the bond market, according to informed sources.

The company scrapped its proposed $150 million bond offering (B3/CCC+), increased the size of its first-lien term loan to $190 million from $165 million and added an $85 million second-lien term loan.

In addition, Targus plans to make a $25 million offering of PIK notes. However, a source said late Tuesday that no further information was available on the PIK notes.

The restructuring of the financing also includes a $15 million increase in the equity contribution from the sponsor.

Goldman Sachs & Co. and UBS Investment Bank were leading the Targus bond offering.

Proceeds from the bank and PIK notes financing will be used to support Fenway Partners Inc.'s leveraged buyout of Targus from Apax Partners LP for $382.5 million.

Targus is based in Anaheim, Calif.

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