Ravago set to launch $325M term loan with lender call on Feb. 9

Sole lead arranger Wells Fargo will launch a $325 million term loan B for Ravago SA with a lender call at 11 a.m. ET on Feb. 9, according to sources. Commitments will be due by noon ET on Feb. 18.

Price talk on the seven-year covenant-lite first-lien term loan is set at L+250-275, with a 0% Libor floor and an original issue discount of 99.5. Lenders will be offered six months of 101 soft call protection. At talk, the yield to maturity is approximately 2.81%-3.06%.

The facility will have an accordion feature with the same terms as the existing term loan. The accordion is the greater of $100 million or an amount subject to a 4.0x senior secured leverage ratio, subject to 50 bps of MFN protection.

Proceeds from the transaction will be used to refinance the company's existing term loan due July 2023 (L+275, no Libor floor), pay off an intercompany loan from Ravago SA established to fund Blue Tree's acquisition of Bamberger and to fund a distribution to the ultimate parent. The borrowers are Blue Tree Holdings Inc., Ravago Holdings America, Inc. and Bamberger Polymers Corp.

Facility ratings are expected to be BB/B1, with a 2 recovery rating from Fitch, while corporate ratings are expected to be BB-/Ba3, with a stable outlook from both Moody's and Fitch.

Privately held Ravago is an independent distributor and reseller of plastic resins in North America and Latin America.

Article amended at 11:09 a.m. ET on Feb. 8 to adjust the lender call date.