Tech Data launches $5 billion credit facilities to investors

By Sara Rosenberg

New York, June 15 – Tech Data Corp. launched on Monday $5 billion of five-year ABL credit facilities (BBB-/BBB-), according to a market source.

The facilities consist of a $3 billion ABL revolver, a $1.5 billion covenant-lite ABL term loan and a $500 million covenant-lite FILO ABL term loan.

Pricing on the revolver can range from Libor plus 125 basis points to 175 bps subject to a grid based on availability.

Price talk on the term loan is Libor plus 350 bps with a 0% Libor floor and an original issue discount of 97 to 98, and price talk on the FILO term loan is Libor plus 550 bps with a 0% Libor floor and a discount of 96 to 97, the source said.

The term loan has 101 soft call protection for six months, and the FILO term loan has 101 soft call protection for one year.

Security is a perfected first priority interest in receivables, inventory and related proceeds thereof of the borrowers and guarantors, excluding inventory to the extent inventory of any borrower or any guarantor is not included in the borrowing base.

Amortization on the term loan and FILO term loan is 1% per annum.

Commitments are due at 5 p.m. ET on June 25, the source continued.

Citigroup Global Markets Inc., J.P. Morgan Securities LLC, Wells Fargo Securities LLC, Barclays, RBC Capital Markets, Credit Suisse Securities (USA) LLC, MUFG, Mizuho, Goldman Sachs Bank USA, Deutsche Bank Securities Inc., BNP Paribas Securities Corp., Nomura and PNC Capital Markets are the leads on the deal, with Citigroup the left lead on the term loan and JPMorgan the left lead on the FILO term loan. Citigroup is the administrative agent.

Proceeds will be used to help fund the buyout of the company by Apollo Global Management Inc. for $130 per share in a transaction with an enterprise value of $5.4 billion.

The company said in filings with the Securities and Exchange Commission that it is also planning $3.2 billion of equity for the buyout.

Lenders should be prepared for the transaction to close on or after June 30, the source added.

Tech Data is a Clearwater, Fla.-based distributor of IT products.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.