Cineworld finalizes €607.6 million term loan B at par issue price

By Sara Rosenberg

New York, Feb. 7 – Cineworld Group plc set the issue price on its €607.6 million seven-year covenant-light term loan B at par, the tight end of the revised talk of 99.75 to par and tight of initial talk of 99.5, according to a market source.

Pricing on the euro loan remained at Euribor plus 262.5 basis points with a 0% floor.

The company is also getting a $3,325,000,000 seven-year covenant-light term loan B priced at Libor plus 250 bps with a 0% Libor floor and an original issue discount of 99.75.

Both term loans have a 25 bps step-down when net secured leverage is less than 3.5 times, 101 soft call protection for six months and amortization of 1% per annum.

Earlier in syndication, the U.S. term loan was upsized from $3 billion, the spread was reduced from Libor plus 275 bps and the original issue discount was changed from 99.5, and the euro term loan was upsized from $600 million equivalent and pricing was cut from Euribor plus 300 bps.

Also previously, plans were cancelled for a pound sterling seven-year covenant-light term loan B that was talked at Libor plus 350 bps with a 0% Libor floor and 101 soft call protection for six months. Prior to the bank meeting, it was said that the total amount of term loan B debt would be about $4 billion equivalent, including a carve-out of $1 billion across euro and pound sterling with the split to be determined.

The company’s roughly $4,375,000,000 equivalent of senior secured credit facilities (B1/BB-) also include a $300 million five-year revolver.

Barclays and HSBC Bank plc are the global coordinators on the debt, with Barclays left on the U.S. loan and HSBC left on the euro loan. Barclays is the administrative agent.

Proceeds will be used to help fund the acquisition of Regal Entertainment Group and refinance existing debt.

Other funds for the transaction will come from around $2.27 billion in equity.

Under the agreement, Regal is being bought for $23.00 in cash for each share of class A and class B common stock, for a total transaction value of $5.9 billion, including the assumption of debt and net of cash acquired.

Closing is anticipated in early March.

Net leverage is expected to be around 4 times.

Cineworld is a London-based cinema operator. Regal is a Knoxville, Tenn.-based motion picture exhibitor.

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