Flow Control updates first- and second-lien term loan pricing

By Sara Rosenberg

New York, March 17 – Flow Control Group (Flow Merger Sub Inc.) firmed pricing on its $625 million seven-year covenant-lite first-lien term loan (B2/B-), which includes a $100 million delayed-draw tranche, at Libor plus 375 basis points, the low end of the Libor plus 375 bps to 400 bps talk, and added a 25 bps step-down at 5.9x total net leverage, according to a market source.

Also, the original issue discount on the first-lien term loan was revised to 99.75 from 99.5, and the delayed-draw term loan ticking fee was changed to half the margin from days 61 to 120 and the full margin thereafter from 0.75% starting on day 61.

In addition, pricing on the company’s $110 million eight-year covenant-lite second-lien term loan (Caa2/CCC) was reduced to Libor plus 675 bps from talk in the range of Libor plus 700 bps to 725 bps, the source said.

As before, both term loans have a 0.5% Libor floor, the first-lien term loan has 101 soft call protection for six months, and the second-lien term loan has an original issue discount of 99 and call protection of 102 in year one and 101 in year two.

Credit Suisse Securities (USA) LLC, UBS Investment Bank and KKR Capital Markets are the lead arrangers on the deal, with Credit Suisse the left lead on the first-lien loan and UBS the left lead on the second-lien loan.

Recommitments were scheduled to be due at noon ET on Wednesday, the source added.

Proceeds will be used to help fund the buyout of the company by KKR from Bertram Capital and to finance deals under letters of intent.

Flow Control is a Charlotte, N.C.-based distributor and technical adviser for mission critical flow control and industrial automation products and related services.

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