Resideo Technologies upsizes term loan to $950M

Resideo Technologies Inc. upsized its proposed term loan B by $150 million, to $950 million, and the commitment deadline for the J.P. Morgan-led transaction has been accelerated to today at noon ET, from Feb. 9, according to sources.

Price talk for the seven-year covenant-lite TLB is L+250-275, with a 0.5% Libor floor and an issue price of 99.5. That works out to a yield to maturity of about 3.12%-3.38%. Lenders are offered six months of 101 soft call protection.

Proceeds will be used to refinance the company's term loan A due 2023 and term loan B due 2025 (L+225, 0% Libor floor), and to redeem up to $140 million of its 6.125% senior unsecured notes due 2026. As of Sept. 30, there was $324 million of the TLA outstanding and $468 million of the TLB, company filings shows. Additional proceeds from the upsizing will be used to reduce cash from the balance sheet that was to be used as part of the transaction.

In addition, the company will have a new $500 million, five-year revolving credit facility.

Moody’s on Jan. 28 upgraded Resideo’s corporate rating to Ba3, from B1, and assigned a Ba2 rating to the first-lien facilities, with a stable outlook. S&P Global Ratings rates Resideo BB with a stable outlook, which was revised from negative, and the facility and recovery ratings are BBB- and 1.

Resideo Technologies is a provider of residential comfort and security solutions.