Flender allocates €965M loan backing Carlyle buyout; terms

The €965 million term loan backing Carlyle's carve-out of Flender GmbH has priced and allocated in line with revised guidance given earlier this week, at E+375 with a 0% floor offered at par, via group led by physical bookrunners and MLAs BofA Securities, Deutsche Bank and UniCredit. The deal is free-to-trade, and broke in a 100.75/101.25 market. Final terms give a yield of 3.8%, and compare with guidance given at launch of a €1.045 billion TLB at E+375 with a 0% floor offered at 99.50-99.75.

The loan was reduced following the carve-out of an €80 million-equivalent renminbi tranche that was privately placed via sole-lead arranger Bank of China. The euro loan also features an ESG-linked margin ratchet of 5-10 basis points (linked to the power volume of new gearbox installations in wind turbines). BofA Securities and Deutsche Bank are sustainability arrangers, and the borrower will donate half of the savings from the ratchet to ESG charities. RBC, Commerzbank and Goldman Sachs are also passive bookrunners and MLAs on the entire deal, while Bank of China, NH Investment (sole lead Korea arranger), Helaba, MUFG, SEB and SMBC are MLAs.

Carlyle announced the acquisition of Flender from Siemens for €2 billion in a statement at the end of October 2020. In addition to the seven-year term loan, the financing features a €150 million 6.5-year revolver and a €125 million 6.5-year guarantee facility. Flender specializes in mechanical and electrical drive technology, including gearboxes, couplings and generators. The firm posted sales of roughly €2.2 billion in FY'20 and is headquartered in Bocholt, Germany. Terms:

Article amended at 3 p.m. GMT on Jan. 22, 2021, to add agent bank.