A-Gas changes $520 million term loan B OID talk to 85-86

By Sara Rosenberg

New York, Dec. 5 – A-Gas FinCo Inc. revised the original issue discount talk on its $520 million senior secured covenant-lite term loan B (B2) to a range of 85 to 86 from a range of 96 to 97, according to a market source.

In addition, while pricing on the term loan remained at SOFR plus 500 basis points with a 25 bps step-down upon an initial public offering, the company removed the 25 bps step-downs at 0.5x and 1x inside opening senior secured net leverage, the source said.

Also, the floor on the term loan was increased to 0.5% from 0%, the 101 soft call protection was extended to one year from six months and the maturity was shortened to six years from seven years.

Changes were made to documentation as well, including revising the fixed incremental to 75% of EBITDA from 100%, removing reallocations from general debt basket, and removing the inside maturity basket.

MFN was modified to reduce the differential to 50 bps from 100 bps, remove the six-month sunset, apply MFN protection to all-in-yield instead of to margin-based, and apply MFN to incremental equivalent debt, ratio debt or ratio acquisition debt from did not apply.

EBITDA was revised to impose a cap on go-forward pro forma adjustments of 30% of the pro forma consolidated EBITDA, which is a shared cap with addbacks for new customers or third-party contracts, from no cap, and include a look forward horizon of 18 months from no look forward.

Furthermore, the company removed the restricted payment debt basket and the starter debt basket, and reduced the contribution debt basket to 100% from 200%.

And, lender calls are now required every quarter in connection with delivery of quarterly and annual financials.

Citigroup Global Markets Inc., HSBC Securities (USA) Inc., Guggenheim and Truist Securities are the joint arrangers on the deal. Truist is the administrative agent.

Recommitments are due at noon ET on Monday, the source added.

Proceeds will be used to help fund the acquisition of a majority stake in the company by TPG from KKR. KKR will remain a significant minority shareholder in the business.

Closing is expected by the end of the year, subject to customary conditions, including certain regulatory approvals.

A-Gas is a U.K.-based supplier and lifecycle manager of refrigerant and industrial gases, fire suppressants and blowing agents.

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