PrimeSource sets price talk on $1.095B term loan for buyout; commits due Jan. 21

A Deutsche Bank-led arranger group has set price talk for the $1.095 billion first-lien term loan backing Clearlake Capital's acquisition and subsequent merger of PrimeSource Building Products Inc. and Dimora Brands Inc., according to sources. Commitments are due Thursday, Jan. 21.

Price talk for the covenant-lite seven-year term loan has been set at L+400-425, with a 0.75% Libor floor and an original issue discount of 99. Lenders are offered six months of 101 soft call protection. At talk, yield to maturity is approximately 5.02%-5.28%.

Additional arrangers include Credit Suisse, RBC Capital Markets, Wells Fargo, Nomura, Golub Capital and Antares Capital.

Investors are being guided to facility ratings of B/B2/B+, with recovery ratings of 4 and 3 from S&P Global Ratings and Fitch, respectively. Corporate ratings are being guided at B/B2/B, with a negative outlook from Ratings and stable outlooks from Moody's and Fitch. The borrower is Park River Holdings LP.

Clearlake will acquire PrimeSource from existing sponsor Platinum Equity in a transaction announced Nov. 16, 2020. Clearlake also announced Nov. 25, 2020, that it would acquire Dimora Brands, or TKE Holdings, from The Jordan Co. for an undisclosed amount.

PrimeSource has a covenant-lite first-lien term loan due May 2022 (L+300, 1% Libor floor) that totaled $426 million when it was repriced in January 2017. Dimora Brands has a covenant-lite first-lien term loan due August 2024 (L+350, 1% Libor floor) that totaled $254 million when it was repriced in March 2018.

Irving, Texas -based PrimeSource is an international distributor of building materials serving the residential, commercial and industrial new construction and remodeling markets. Dimora Brands provides branded specialty hardware and home accessories.