10 Feb, 2022

ITP Aero completes $667M term loan for buyout by Bain Capital; terms

Investors have received allocations of the €575 million-equivalent, or about $666.7 million, U.S. dollar-denominated first-lien term loan for ITP Aero that priced tight to talk through a Credit Suisse-led arranger group, according to sources.

Pricing for the seven-year term loan was finalized at a spread of 400 basis points over the secured overnight financing rate, with a 0.5% floor and an original issue discount of 99.5. Also, there is a margin step-down of 25 bps at 0.5x inside closing first-lien net leverage. Proceeds from the deal will be used to back the acquisition of the company by Bain Capital from Rolls-Royce Holdings PLC for approximately €1.7 billion. Financing will also include a €100 million euro-denominated revolving credit facility.

ITP Aero engages in the design, research and development, manufacture and casting, assembly and testing of aeronautical engines and gas turbines.

Terms:

Borrower ITP Aero (Propulsion (BC) Finco Sarl; Propulsion (BC) Newco LLC)
Issue $666.7 million first-lien term loan
UoP LBO
Spread Sofr+400
Sofr floor 0.50%
Price 99.50
Tenor 7-year
YTM 4.67%
Four-year yield 4.72%
Call protection 101 soft call for 6 months
Corporate ratings B/B2
Facility ratings B/B2
Recovery ratings 3
Financial covenants None
Arrangers CS/RBC/Sant/BBVA/GS/SC
Admin agent CS
Px Talk Sofr+425-450/0.5%/99
Sponsor Bain Capital
Notes Margin step-down of 25 bps at 0.5x inside closing first-lien net leverage. Ticking fee: 0% for 60 days; 50% of margin for days 61-120; 100% of margin thereafter.