Celanese/Blackstone acetate tow JV plans $2.4 billion in loans, bonds

By Sara Rosenberg

New York, June 19 – An acetate tow supplier joint venture being formed by Celanese Corp. and Blackstone has received a commitment for $1,605,000,000 of credit facilities and plans to issue $800 million in senior unsecured notes, according to an 8-K filed with the Securities and Exchange Commission on Monday.

Barclays, Credit Suisse and Deutsche Bank are the leads on the debt.

The credit facilities consist of a $65 million senior unsecured revolver, a $135 million senior secured revolver, $1,005,000,000 in senior secured term loans and a $400 million senior unsecured term loan.

Only the unsecured revolver and term loan are guaranteed by Celanese.

The notes are backed by a commitment for an $800 million senior unsecured bridge facility.

Under the agreement, Celanese will contribute its Cellulose Derivatives business unit and Blackstone will contribute its Freiburg, Germany-based Rhodia Acetow business unit to the joint venture.

Proceeds from the new debt will be used to fund a roughly $1.6 billion dividend to Celanese and to refinance existing debt contributed to the joint venture.

Debt to EBITDA at the joint venture will be around 3.5 times.

The new company is expected to generate 2017 annual pro forma revenue of about $1.3 billion.

Closing is subject to regulatory approvals and customary conditions.

Celanese will own 70% of the joint venture, and Blackstone will own 30%.

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