| LONDON, March 8
LONDON, March 8 Allnex is conducting a
€1.8bn-equivalent loan to back a dividend recapitalisation that
will net a €425m payout to its owners, ditching plans to reprice
an existing loan after huge demand from investors for the
Belgian chemicals company to issue new paper, banking sources
Advent International-owned Allnex launched a cross-border
repricing of its €730m term loan and US$698.2m term loan on
February 28 and commitments were due March 3, but in an unusual
move, reverse enquiries from institutional investors led the
company to launch a dividend recapitalisation instead, the
In addition to the existing loans, there will be a new
€425m-equivalent loan, split between euros and dollars, the
“It is unusual to go from a repricing to a dividend recap
but it is a function of the market, which is red hot -- enough
to do a proper upsize,” a senior loan banker said.
The euro loans are guided to pay 325bp-350bp over Euribor
with a 0% floor, in line with the initial repricing while the
dollars are guided to pay 325bp-350bp, with a 0.75% floor, 25bp
higher than where the repricing was guided.
The existing money will be offered at par, while the new
money is offered at 99.75 OID.
“The price range on the euros didn’t change as a result of
the dividend, whereas the price range of the dollars went up by
25bp. It is a function of where the demand is coming from and
the euro demand is insane,” the banker said.
Morgan Stanley is sole coordinator and lead bookrunner,
while ING is bookrunner and agent.
Lenders have been asked to commit to the deal by Thursday.
Cash-rich investors to Europe’s leveraged loan market have
been desperate for new paper, following a spate of repricings
and refinancings of existing deals.
Allnex’s existing loans formed part of a
US$1.525bn-equivalent financing raised in June 2016 to back
Allnex’s acquisition of New Zealand chemicals company Nuplex
Industries and to refinance debt at both companies.
Both the euro and dollar term loans priced in June 2016 at
425bp over Euribor, with a 0.75% floor and 99.5 OID.
(Editing by Christopher Mangham)