A Citigroup-led arranger group yesterday launched a roughly $2.84 billion senior secured pro rata credit facility for Crown Holdings that backs the company’s planned €1.2 billion ($1.6 billion) acquisition of Mivisa Envases, a Spanish can manufacturer, from affiliates of The Blackstone Group, source said.
The deal is split between an $800 million, five-year A term loan, a €400 million ($538 million), five-year A term loan, a $300 million farm credit facility, and a $1.2 billion, five-year multicurrency revolver. Pricing opens at L/E+175, with lenders being offered 25-50 bps upfront.
Citi is joined by Deutsche Bank, Bank of America Merrill Lynch, RBS, Santander, and Wells Fargo.
Commitments are due Dec. 6.
The deal had originally included a $700 million B term loan, as outlined in the commitment letter. The deal right now, though, is just being shopped to relationship banks, sources note.
The original commitment letter, which the company obtained late last month, provided for a potential amendment to Crown’s existing senior secured credit facility to allow the company to obtain a new A term loan of up to $960 million alongside the $700 million B term loan. The other option, as originally outlined in the commitment letter, was for Crown to enter into a new facility that would be split between a $1.18 billion A term loan, a $700 million B term loan, a €110 million term loan, and a $1.2 billion revolver.
S&P yesterday assigned a BBB- issue rating and 1 recovery rating to the new pro rata loan package and stated that Crown’s BB+ corporate credit rating remains on CreditWatch with negative implications. S&P expects to lower Crown’s ratings to BB when the Mivisa acquisition is completed.
The acquisition is expected to close in 2014.
As of Sept. 30, Crown had $221 million outstanding under its TLA due 2016 and the $149 million outstanding under its euro-denominated term loan due 2016, according to a regulatory filing. Pricing on both loans opens at L+175. The company also has $436 million outstanding under its revolver.
In January, the company completed a $1 billion offering of 4.5% senior unsecured notes due 2023 to redeem the $400 million outstanding under its senior notes due 2017 and to repay $500 million under its senior secured credit facility.
Philadelphia-based Crown Holdings, formerly Crown Cork & Seal, supplies packaging products to consumer-marketing companies around the world. The company is rated Ba1 by Moody’s. – Richard Kellerhals