Callaway Golf launches $480 million term B at Libor plus 400-425 bps

By Sara Rosenberg

New York, Dec. 6 – Callaway Golf Co. held a bank meeting at 12:30 p.m. ET in New York on Thursday to launch a $480 million seven-year covenant-light term loan B (Ba3/BB-) that is talked at Libor plus 400 basis points to 425 bps with a 0% Libor floor and an original issue discount of 99, according to a market source.

The term loan has 101 soft call protection for six months, the source said.

Bank of America Merrill Lynch and J.P. Morgan Securities LLC are the lead arrangers on the deal.

Commitments are due at noon ET on Dec. 14, the source added.

Proceeds will be used to fund the acquisition of Jack Wolfskin for €418 million, subject to certain purchase price adjustments.

Pro forma debt to EBITDA is around 2.9 times.

Closing is expected in the first quarter of 2019, conditioned on regulatory approvals and other customary conditions.

Callaway Golf is a Carlsbad, Calif.-based manufacturer and seller of golf clubs and golf balls, and seller of bags, accessories and apparel in the golf and lifestyle categories. Jack Wolfskin is an Idstein, Germany-based outdoor apparel, footwear and equipment brand.

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