Allied Universal sets price talk for $850M add-on term loan B

Allied Universal Corp. has launched an $850 million incremental first-lien term loan to repay borrowings outstanding under its revolver and asset-based loan facility, according to sources. A lender call was scheduled for today at 1 p.m. ET, and commitments to the Credit Suisse-led deal are due by 5 p.m. ET on Nov. 18.

The add-on is offered at 99.25-99.5 and will be fungible with the existing covenant-lite first-lien term loan due May 2028 that is priced at L+375, with a 0.50% Libor floor. At talk, the yield to maturity is 4.41%-4.46%. There is no call protection on the loan.

Expected corporate and facility ratings are B/B2, with stable outlooks, and with a 3 recovery rating on the loan from S&P Global Ratings. Allied Universal Holdco Inc. is the borrower.

BMO Capital Markets and BNP Paribas are joint lead arrangers on the deal.

In May, Allied issued the existing $3.14 billion tranche as part of a cross-border financing for the acquisition of G4S and to refinance the company's existing facility. Pricing was finalized with a 25-basis-point margin step-down after 0.5x of total net leverage deleveraging and a 25-basis-point step-down at ratings of B+/B1, with stable outlooks. In addition to the dollar tranche, the company's financing package included a €715 million TLB due 2028 (E+375, 0% floor) as well as secured and unsecured notes.

Allied Universal provides security and janitorial services for commercial office and retail properties.

* Article updated at 7:50 a.m. ET on Nov. 16, 2021, to update arranger group.