Paragon Films preps launch of 1st-lien, 2nd-lien term loans for buyout

Paragon Films Inc. is preparing to launch new first-lien and second-lien term loans to finance the buyout of the company by Rhone Capital, according to sources. A lender call is scheduled for 10:30 a.m. ET on Dec. 1, and commitments will be due by noon ET on Dec. 14.

The financing comprises a $345 million first-lien term loan facility that includes a $300 million funded tranche and a $45 million delayed-draw, and a $100 million second-lien term loan. The first-lien tranche will have a seven-year maturity and comes with six months of 101 soft call protection. The second-lien has an eight-year maturity, and there are hard calls at 102 and 101 in years one and two, respectively.

Credit Suisse is leading the deal, while BMO Capital Markets, KKR Capital Markets and RBC Capital Markets are joint lead arrangers.

Investors are being told to expect first-lien ratings of B-/B2, with a 3 recovery rating from S&P Global Ratings, and second-lien ratings of CCC/Caa2, with a recovery rating of 6. Corporate ratings are expected to be B-/B3, with stable outlooks.

Paragon Films, based in Broken Arrow, Okla., is a manufacturer of ultra high-performance cast stretch films.