Cirque du Soleil tightens OID on $635 million first-lien loan to 99.75

By Sara Rosenberg

New York, June 25 – Cirque du Soleil revised the original issue discount on its $635 million seven-year first-lien covenant-light term loan (B1/B+) to 99.75 from revised talk of 99.5 and initial talk of 99, according to a market source.

Pricing on the first-lien term loan is still Libor plus 400 basis points with a step-down to Libor plus 375 bps at 4 times net total leverage and a 1% Libor floor.

The first-lien term loan has 101 soft call protection for one year.

Earlier in syndication, the first-lien term loan was upsized from $615 million, pricing was reduced from Libor plus 425 bps, the step-down was added and the call protection was extended from six months.

The company’s $885 million credit facility also includes a $100 million revolver (B1/B+) and a $150 million eight-year second-lien covenant-light term loan (Caa1/CCC+).

Pricing on the second-lien term loan is Libor plus 825 bps with a 1% Libor floor and an original issue discount of 98.5.

The second-lien term loan has call protection of 102 in year one and 101 in year two.

On Wedneday, the second-lien term loan was downsized from $170 million, pricing firmed at the low end of the Libor plus 825 bps to 850 bps talk and the discount was set at the wide end of the 98.5 to 99 talk.

Additionally, at the time of the initial changes, the MFN sunset on the first- and second-lien term loans was removed.

Recommitments were due at 11 a.m. ET on Thursday, the source added.

Deutsche Bank Securities Inc., Bank of America Merrill Lynch, RBC Capital Markets LLC, UBS AG, BMO Capital Markets Corp., National Bank of Canada, Scotiabank and TD Securities (USA) LLC are the bookrunners on the deal, with Deutsche the left lead on the first-lien loan and Bank of America the left lead on the second-lien loan.

Proceeds will be used to help fund the buyout of the company by TPG and Fosun Capital. Caisse de depot et placement du Quebec will also acquire a minority interest in the company.

Closing is expected in the third quarter, subject to customary conditions.

Cirque du Soleil is a Montreal-based producer of live artistic entertainment.

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