Phillips-Van Heusen reduces term loan B size to $1.425 billion

By Sara Rosenberg

New York, April 26 - Phillips-Van Heusen Corp. downsized its six-year term loan B to $1.425 billion from $1.5 billion as a result of an upsizing to its bond deal, according to a market source.

The 7 3/8% senior notes due 2020 ended up sized at $600 million, up from a most recent size of $525 million.

In addition, the company sold $332.5 million of common equity, comprised of 5 million shares at a price of $66.50 per share, up from a most recently planned size of $275 million. These extra funds will add cash to the balance sheet.

Pricing on the term loan B is Libor plus 300 basis points on the U.S. piece and Euribor plus 325 bps on the euro piece, with a 1.75% Libor floor and an original issue discount of 99½ on the entire tranche.

The company's new $2.375 billion senior secured credit facility (Ba2/BBB) also includes a $450 million five-year revolver and a $500 million five-year term loan A, with both tranches priced at Libor plus 300 bps on the U.S. pieces and at Euribor plus 325 bps on the foreign pieces.

The term loan A has a 1.75% Libor floor, while the revolver has no floor, and upfront fees on the two tranches are 100 bps on allocation for a $40 million commitment and 50 bps on allocation for a $20 million commitment.

Barclays Capital and Deutsche Bank are the global debt coordinators and bookrunners on the credit facility, with Barclays the left lead. Other bookrunners include Bank of America, Credit Suisse and RBC Capital Markets.

Proceeds from the credit facility, bonds and stock will be used to help fund the acquisition of Tommy Hilfiger BV from Apax Partners LP for €2.2 billion, or about $3 billion, plus the assumption of €100 million in liabilities, and to refinance Phillips-Van Heusen's $300 million of existing senior unsecured notes due in 2011 and 2013.

The consideration to be paid to Apax includes €1.924 billion in cash and €276 million in Phillips-Van Heusen common stock.

New York-based Phillips-Van Heusen and Tommy Hilfiger are apparel companies.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.