Hillman launches $290 million term B repricing at Libor plus 350 bps

By Sara Rosenberg

New York, April 11 - Hillman Group Inc. launched its roughly $290 million term loan B repricing on Monday morning with price talk of Libor plus 350 basis points with a 1.5% Libor floor and a par offer price, according to a market source.

The term loan B will include 101 soft call protection for one year, the source said.

By comparison, current pricing on the term loan B, which was obtained in 2010 for a buyout by Oak Hill Capital Partners, is Libor plus 375 bps with a 1.75% Libor floor and there is no call protection. The term loan B had been sold at an original issue discount of 991/2.

The company is also looking to amend its credit facility to eliminate the total leverage and interest coverage ratios and to reset the senior secured leverage ratio at 4.75 times with no step-downs, the source said. Currently, the senior secured leverage ratio is 4.0 times with step-downs.

Also, revolver drawings will be subject to a 4.0 times senior secured leverage ratio covenant.

Additionally, the amendment would revise the acquisition basket, the accordion feature and the company's ability to incur unsecured debt to give more flexibility to do acquisitions and finance those acquisitions with debt, the source continued.

Consents are due on April 18.

There is no amendment fee being offered.

Barclays Capital Inc., Morgan Stanley & Co. Inc. and GE Capital Markets are the lead banks on the deal.

Hillman is a Cincinnati-based distributor of fasteners, key duplication systems, engraved tags and related hardware items.

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