October 3, 2017 / 2:37 PM / a year ago

LPC-Bankers pitch €3bn-equiv debt deal for PAI’s Refresco bid

LONDON, Oct 3 (Reuters) - Bankers are pitching debt financings of around €3bn-equivalent to back French private equity firm PAI Partners’ take private offer for Dutch juice bottling company Refresco, banking sources said on Tuesday.

Refresco is considering the new €1.6bn (US$1.9bn) buyout offer that was announced on Tuesday, and follows PAI’s earlier €1.4bn offer in April which Refresco rejected.

The acquisition is another potential take private transaction as private equity firms come under more pressure to spend their ‘dry powder’ and follows Bain Capital and Cinven’s buyout of German generic drugmaker Stada which closed in September. [

After rejecting PAI’s initial offer, Refresco agreed to buy the bottling activities of Canada-based Cott Corp for US$1.25bn in July. The acquisition, which was financed with around €2bn of leveraged loans, is on track to close before the end of 2017.

Banks are aggressively pitching debt financings to fund PAI’s latest bid which include the Cott acquisition debt, the sources said. PAI has not mandated any banks as yet, they added.

PAI declined to comment and Refresco was not immediately available to comment on the financing.

The new €3bn debt financing is expected to consist of senior leveraged loans and subordinated high yield bonds, the sources said.

The €3bn deal will finance Refresco’s buyout and repay the €2bn-equivalent of leveraged loans that financed the Cott acquisition, the sources said.

That €2bn-equivalent leveraged loan financing was completed and allocated on September 27. JP Morgan led the deal with bookrunners ABN Amro, BNP Paribas and Rabobank. Commerzbank, HSBC, MUFG, Mizuho and Societe Generale also joined as mandated lead arrangers.

As the existing loans do not have a portability clause, any change of control will trigger a repayment, the sources said. It is not clear whether the banks that led the last deal will be involved in the new financing, they added.

Refresco, which was founded in 1999, was acquired by 3i in 2003 and sold to an Icelandic investor consortium in 2006, before floating in 2015. It makes and bottles fruit juices and soft drinks for retailers and brands in Europe and the United States.

Other recent take private buyouts include Blackstone and CVC Capital Partners’ acquisition of UK payment processing company Paysafe and US private equity firm Hellman & Friedman’s DKr33.1bn (US$5.3bn) takeover offer for payments firm Nets.

A kickoff meeting was held in London on Tuesday for the Paysafe deal to discuss a timetable for syndicating the US$2.5-3bn equivalent of leveraged loans backing the purchase.

Bankers are expecting to see more delisting deals for companies that were previously owned by private equity firms before they were floated, the sources said.

“We can expect to see more public to private deals where companies were previously owned by buyout firms, as it can be argued that they are better off back in private hands,” a senior banker said. (Editing by Tessa Walsh)

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