Boardriders firms $450 million term loan B at Libor plus 650 bps

By Sara Rosenberg

New York, March 21 – Boardriders Inc. finalized pricing on its $450 million six-year term loan B (B3/B-) at Libor plus 650 basis points, the high end of the Libor plus 625 bps to 650 bps talk, according to a market source.

Also, the ticking fee was revised to 325 bps for 30 days beginning March 26 and 650 bps thereafter to be paid at close, the source said.

In addition, the EBITDA definition was changed to a 25% cap on adjustments and add-backs excluding the $90 million of run-rate cost savings and $110 million of one-time cost to achieve related to the Billabong acquisition. Run-Rate cost savings and cost to achieve related to the Billabong acquisition will be available to add back to EBITDA for 24 months post-closing.

Furthermore, the general restricted payments basket is capped at $10 million in the first year, the use of the available amount for permitted investments is subject to closing total net leverage, and the aggregate use of non-credit party debt capacity is capped at $100 million, the source added.

As before, the term loan has a 1% Libor floor, an original issue discount of 98, call protection of non-callable for one year, then at 102 in year two and 101 in year three, and a total net leverage covenant.

The company’s $590 million of credit facilities also provide for a $150 million asset-based revolver.

Deutsche Bank, Bank of America Merrill Lynch and Macquarie Capital (USA) Inc. are the bookrunners on the deal.

Proceeds will be used to fund the acquisition of Billabong International Ltd.

Closing is expected in mid-to-late April.

Boardriders, owned by funds managed by Oaktree Capital Management, LP, is a Huntington Beach, Calif., action sports and lifestyle company that designs, produces and distributes apparel, footwear and accessories.

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