July 11, 2017 / 4:53 PM / a year ago

UPDATE 1-LPC-Diversey’s US$2.65bn buyout financing set for sell down

(Adds loan details)

By Claire Ruckin

LONDON, July 11 (Reuters) - A US$2bn leveraged loan financing backing Bain Capital’s buyout of Sealed Air Corp’s cleaning and chemicals systems division and its food care division has launched for syndication, banking sources said on Tuesday.

Sealed Air Corp said in March it would sell Diversey Care and its food hygiene business to Bain Capital for about US$3.2bn, as it focuses on its higher margin businesses. The two divisions will be put together and called New Diversey.

The cross-border financing comprises a US$900m term loan, an €820m term loan, and a US$250m revolving credit facility.

The seven-year covenant-lite first-lien term loans form part of a wider financing package that is expected to include US$600m of unsecured bonds, although they have yet to launch.

Bank meetings are due to take place in the US on Wednesday and London on Thursday, when loan pricing will emerge. The loans are offered with a 0% floor and 101 soft call for six months.

Lenders have been asked to commit to the loans by July 26.

Credit Suisse and Goldman Sachs are leading the financing, alongside Bank of America Merrill Lynch, Barclays, Citigroup, HSBC, Jefferies, RBC and SunTrust.

Charlotte, North Carolina-based Sealed Air acquired Diversey in 2011 from its controlling shareholders, the Johnson family and private equity firm Clayton, Dubilier & Rice LLC, in a US$4.3bn cash-and-stock deal.

Sealed Air said it would use the proceeds to repay debt, repurchase shares, maintain its net leverage ratio in the range of 3.5-4.0 times and fund core growth initiatives. (Editing by Christopher Mangham)

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