Melissa & Doug adds rating-based PIK coupon step-up to term loan

By Sara Rosenberg

New York, March 30 – Melissa & Doug (MND Holdings III Corp.) revised pricing on its $260 million first-lien term loan due June 2026 to include 100 basis points PIK coupon if the corporate rating is Caa1, according to a market source.

Pricing on the term loan remained at SOFR+15 bps CSA plus 550 bps with a 1% floor and an original issue discount of 95.

The term loan still has 101 soft call protection for six months.

The company’s $325 million of credit facilities also include a $65 million revolver.

Ratings for the company are private, the source said.

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

Commitments continue to be due at noon ET on Friday, the source added.

Proceeds from the term loan will be used to extend an existing term loan due June 2024 that is priced at SOFR+15 bps CSA plus 350 bps with a 1% floor.

Melissa & Doug is a Wilton, Conn.-based specialty toy brand with an educational focus.

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