Zep launches $360 million term loan B at Libor plus 500 bps

By Sara Rosenberg

New York, June 3 – Zep Inc. launched on Wednesday its $360 million seven-year term loan B with price talk of Libor plus 500 basis points with a 1% Libor floor and an original issue discount of 99, according to a market source.

The term loan has 101 soft call protection for one year, the source said.

The company’s $402.5 senior secured credit facility (B2/B+) also includes a $42.5 million five-year revolver.

Commitments are due on June 17, the source added.

Jefferies Finance LLC, KeyBanc Capital Markets Inc. and Credit Suisse Securities (USA) LLC are the leads on the debt.

Proceeds will be used to help fund the buyout of the company by New Mountain Capital LLC for $20.05 per share in cash. The transaction is valued at about $692 million, including net debt.

Other funds for the buyout will come from $382.5 million in equity.

Closing is expected in the third quarter, subject to stockholder and regulatory approvals.

Zep is an Atlanta-based consumable chemical packaged goods company.

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