ADS Tactical readies launch of $330 million term loan B for Thursday

By Sara Rosenberg

New York, May 1 – ADS Tactical Inc. is scheduled to hold a bank meeting at 2 p.m. ET in New York on Thursday to launch a $330 million seven-year covenant-light term loan B, according to a market source.

Wells Fargo Securities LLC is the lead arranger on the deal.

The term loan has 101 soft call protection for six months and amortization of 1% per annum, the source said.

Mandatory prepayments are from 100% of the net proceeds of the issuance or incurrence of debt and all refinancing debt, 100% of the net cash proceeds of all asset sales, 50% of excess cash flow beginning in 2020 when first-lien leverage is greater than 4.5 times, stepping down to 25% when first-lien leverage is more than 4 times and 0% when first-lien leverage is less than 4 times.

Expected term loan ratings are B3/B.

Commitments are due at 3 p.m. ET on May 17, the source added.

Proceeds will be used to refinance existing debt, including ABL revolver borrowings, a term loan due 2022 and senior secured notes due 2022.

ADS is a Virginia Beach, Va.-based provider of value-added logistics and supply chain solutions specializing in tactical & operational equipment and kitted solutions.

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