9 Nov, 2021

Howden Group completes $550M add-on term loan for acquisition; terms

Howden Group Holdings Ltd. has completed its $550 million incremental term loan B that will be used to support the company's acquisition of Aston Lark, according to sources. The term loan priced tight to talk at an original issue discount of 99 via a Morgan Stanley-led arranger group and is fungible with the issuer's existing covenant-lite term loan B due November 2027 that is priced at L+325, with a 0.75% Libor floor.

Proceeds from the new add-on will be used alongside an $85 million add-on to the firm's existing privately placed dollar-denominated second-lien term loan and a new privately placed £390 million Holdco payment-in-kind facility to support the takeover of Aston Lark.

Howden Group Holdings Ltd., through its subsidiaries, provides specialty and retail insurance brokerage, reinsurance brokerage, and underwriting agency services in the U.K. and internationally. It offers retail broking and risk management services for sole practitioners, associations, small and midsize enterprises, and multinational corporations.

Terms:

Borrower Howden Group Holdings (Hyperion Refinance Sarl)
Issue $550 million fungible incremental first-lien term loan
UoP M&A
Spread L+325
Libor floor 0.75%
Price 99
Tenor November 2027
YTM 4.26%
Four-year yield 4.35%
Call protection 101 soft call reset for 6 months
Corporate ratings B/B2
Facility ratings B/B2
Recovery ratings 3
Financial covenants None
Arrangers MS/Barc/RBC/Lloyds/ING/NatWest
Admin agent MS
Px Talk L+325/0.75%/98.79
Sponsor General Atlantic/CDPQ/HgCapital
Notes Ticking fee: No fee first 30 days, 50% margin days 31-60, 100% margin thereafter; Pro forma tranche size of $2.761 billion