Harbor Freight flexes $2.2 billion term loan to Libor plus 325 bps

By Sara Rosenberg

New York, Aug. 12 – Harbor Freight Tools USA Inc. reduced pricing on its $2.2 billion seven-year covenant-light first-lien term loan (Ba3/BB-) to Libor plus 325 basis points from talk of Libor plus 350 bps to 375 bps, according to a market source.

Also, a 25 bps step-down was added to the term loan at 3x total net leverage, and the Libor floor was trimmed to 0.75% from 1%, the source said.

In addition, the 101 soft call protection was extended to one year from six months and the MFN sunset was eliminated.

The term loan still has an original issue discount of 99.5.

Recommitments were due at 1 p.m. ET on Friday, the source added.

The company’s $2.9 billion credit facility also includes a $700 million ABL revolver.

Credit Suisse Securities (USA) LLC is the lead bank on the deal.

Proceeds will be used to refinance existing debt and fund a shareholder distribution.

Harbor Freight is a Camarillo, Calif.-based provider of tools and equipment.

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