ISS launches $300 million term loan B at Libor plus 300-325 bps

By Sara Rosenberg

New York, March 8 - ISS A/S held a bank meeting on Friday to launch its $300 million term loan B that is talked at Libor plus 300 basis points to 325 bps with a 1% Libor floor and an original issue discount of 991/2, according to a market source.

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

In addition, the company is getting a €380 million term loan A, the source continued.

Goldman Sachs & Co., Deutsche Bank Securities Inc., Nordea and UBS Securities LLC are the bookrunners on the deal.

Proceeds from the new debt will be used to refinance a €600 million second-lien loan due June 30, 2015.

The increase in senior commitments will require a resetting of the annual senior debt covenant.

As previously reported, the company is also out with an amendment and extension proposal.

Specifically, ISS is looking to extend by three years its revolver and letter-of-credit facility due Dec. 31, 2014 and its term loan B and acquisition facility due April 30, 2015, and talk on the extended debt is Euribor plus 400 bps.

And, the credit facility amendment will increase operational and refinancing flexibility by increasing the size of certain baskets and allowing for the refinancing of 2016 notes, EMTN and certain other junior debt with new senior secured debt subject to pro forma senior leverage not exceeding 4.25 times.

Additionally, the amendment will increase flexibility to do disposals subject to disposal proceeds being applied to, pro forma for debt repayment:

• Repay senior debt if senior leverage is greater than 4.5 times;

• Repay senior or junior debt if senior leverage is less than or equal to 4.5 times; and,

• Be retained by the group if senior leverage is less than or equal to 3.5 times.

Furthermore, the amendment will allow the company to use initial public offering proceeds and retained excess cash-flow to repay junior debt, subject to a pro forma total leverage test of 3.5 times.

ISS is a Copenhagen-based facilities services company.

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