AdvancePierre lifts term loan B to $1.3 billion, drops second-lien

By Sara Rosenberg

New York, May 26 – AdvancePierre Foods Inc. upsized its seven-year first-lien covenant-light term loan B to $1.3 billion from a revised amount of $1.15 billion and an initial amount of $1.1 billion, according to a market source.

On the flip side, the amended $150 million covenant-light second-lien term loan, which was recently downsized from $200 million, was dropped from the transaction.

Pricing on the first-lien term loan B is Libor plus 375 basis points with a step-down to Libor plus 350 bps at 4 times net total leverage and corporate family ratings of B1/B+.

The first-lien term loan B has a 1% Libor floor, 101 soft call protection for six months, amortization of 1% per annum and MFN for life, and is being offered at an original issue discount of 99.5.

Earlier in syndication, pricing on the first-lien term loan was reduced from Libor plus 400 bps, the step-down was added and the discount firmed at the tight end of the 99 to 99.5 talk.

The dropped second-lien term loan due October 2020, which was a three year extension from the current maturity, was talked at Libor plus 825 bps with a 1.25% Libor floor and a 50 bps consent fee.

The second-lien term loan was also talked with call protection of 101 for six months, 102 for months six through 18, 101 for months 18 through 30 and par thereafter.

Commitments were scheduled to be due at 2 p.m. ET on Thursday, the source added.

Morgan Stanley Senior Funding Inc., Deutsche Bank Securities Inc., Barclays, Credit Suisse Securities (USA) LLC, Bank of America Merrill Lynch and Macquarie Capital (USA) Inc. are the joint lead arrangers and bookrunners on the deal.

Proceeds will be used to refinance existing debt so as to extend existing maturities.

AdvancePierre is a Cincinnati-based supplier of value-added proteins and sandwich products to foodservice, retail, schools and convenience channels.

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