Siemens Audiology, Douglas Dynamics deals free to trade; Siemens dollar tranche above OID

By Sara Rosenberg

New York, Dec. 12 – Siemens Audiology Systems’ (Auris Luxembourg III Sarl) term loan B emerged in the secondary market on Friday, with the U.S. dollar tranche seen trading above its original issue discount, and Douglas Dynamics Inc. broke as well.

Siemens Audiology breaks

Siemens Audiology’s new bank debt freed up for trading on Friday with the $600 million seven-year covenant-light term loan B-2 quoted at 99 3/8 bid, 99 7/8 offered, according to a market source.

Pricing on the U.S. dollar term loan is Libor plus 450 basis points with a 1% Libor floor and an original issue discount of 99. There is 101 soft call protection for six months.

The company is also getting a €305 million seven-year covenant-light term loan B-1 that is priced at Euribor plus 450 bps with a 1% floor and was issued at a discount of 99¾. This debt has 101 soft call protection for six months as well.

During syndication, the total amount of term debt was upsized from €745 million-equivalent, pricing on the U.S. dollar and euro tranches firmed at the tight end of the Libor/Euribor plus 450 bps to 475 bps talk, the discount on the euro price was tightened from 99 and the MFN sunset provision was eliminated.

Siemens Audiology leads

Deutsche Bank Securities Inc., Goldman Sachs Bank USA and UBS AG are the physical bookrunners on Siemens Audiology’s term loan B debt (B1/B+), with UniCredit a joint bookrunner. Goldman Sachs is the left lead on the U.S. debt, and Deutsche Bank is the left lead on the euro debt as well as the administrative agent.

Proceeds will be used to help fund the buyout of the company by EQT VI and Santo Holding from Siemens AG.

Other funds for the transaction will come from €275 million of bonds that were downsized from €315 million when the term loan was upsized.

Senior leverage is 5 times and total leverage is 6.75 times.

Siemens Audiology is a Singapore-based manufacturer and wholesaler of hearing aid devices.

Douglas Dynamics hits secondary

Douglas Dynamics’ credit facility also broke, with the $190 million seven-year term loan B (B1/BB-) quoted at 99 bid, a trader said.

Pricing on the term loan is Libor plus 425 bps with a 1% Libor floor and it was sold at an original issue discount of 99. The debt has 101 soft call protection for one year.

Recently, the spread on the B loan was reduced from talk of Libor plus 450 bps to 475 bps.

The company’s $290 million credit facility also includes a $100 million five-year revolver.

J.P. Morgan Securities LLC is leading the deal that will be used with cash on hand to fund the acquisition of Henderson for $95 million, subject to working capital, cash and other adjustments, to refinance existing debt and for general corporate purposes.

Closing is expected by year-end, subject to customary regulatory approvals and conditions.

Douglas Dynamics is a Milwaukee-based manufacturer of vehicle attachments and equipment. Henderson is a Manchester, Iowa-based manufacturer of customized, turnkey snow and ice control products for heavy-duty trucks.

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