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Tupperware announces new loan commitment to redeem its senior notes


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Tupperware announces new loan commitment to redeem its senior notes

Tupperware Brands Corp. has entered into a commitment letter for two term loan facilities totaling $275 million to be provided by asset manager Angelo Gordon & Co. LP and JPMorgan Chase Bank NA.

Proceeds of the facilities will be combined with cash on hand to repay the company's $380.2 million of 4.75% senior notes due June 2021, plus transaction fees and expenses.

Tupperware late last month in its latest 10-Q filing reiterated a going-concern warning first issued in its previous 10-Q for the second quarter. The warning alluded to the June maturity of the company's senior notes. In the third-quarter 10-Q, Tupperware reported balance sheet cash and equivalents at quarter-end of $148.8 million.

Angelo Gordon and JPMorgan have committed to providing two secured term loan facilities, one for $200 million with Tupperware as the borrower and the other for $75 million with the company's wholly owned subsidiary, Dart Industries Inc., as the borrower. The loans have no scheduled amortization and will mature in three years. The interest rates will initially be, at Tupperware's option, either the alternate base rate plus 1% and with a 2% floor, plus 7.75%; or Libor, with a 1% floor, plus 8.75%.

The $200 million loan will be guaranteed by the same Tupperware subsidiaries that guarantee the company's March 2019 credit agreement, while the loan to Dart will be guaranteed by Tupperware and certain of its subsidiaries.

Tupperware said it expects the term loan facilities to be borrowed and the senior notes redeemed in 2020's fourth quarter. It added that assuming the bond redemption is successfully completed, it will have no debt maturing until the fourth quarter of 2023. Sandra Harris, Tupperware's CFO and COO, said she believes that "this transaction will satisfactorily remediate the relevant conditions that led to the going concern doubt disclosure in our two most recent quarterly financial reports."

Kirkland & Ellis LLP is acting as Tupperware's legal counsel, and Moelis & Co. LLC is serving as investment banker and capital markets adviser for this transaction.

The 4.75% senior notes due 2021 traded today in odd lots and round lots around par.

Tupperware manufactures and distributes home food preparation, storage and service products.