Bloomberg News

Kinetic Concepts Said to Seek $2.6 Billion Term Loan for LBO

August 01, 2011

(Updates with LBO size in third paragraph.)

Aug. 1 (Bloomberg) -- Kinetic Concepts Inc. plans to finance its leveraged buyout by a group led by Apax Partners LLP with a $2.6 billion term loan, the second-largest such debt offering this year, according to two people with knowledge of the deal.

The debt financing also includes $1.25 billion of senior secured notes, $900 million of senior unsecured bonds and a $200 million revolving credit line, said the people, who declined to be identified, because the details haven’t been disclosed.

The term loan would be the second largest such deal this year behind the $2.7 billion of debt supporting Del Monte Food Co.’s buyout by KKR & Co., according to data compiled by Bloomberg. Morgan Stanley, Bank of America Corp. and Credit Suisse Group AG have committed funding for the $6.3 billion purchase of San Antonio-based Kinetic, the biggest LBO since Lehman Brothers Holdings Inc. failure in September 2008.

Morgan Stanley is leading the loan and Bank of America is arranging the notes offering, one of the people said.

The maker of wound-care products has agreed to be taken private by Apax, the Canada Pension Plan Investment Board and the Public Sector Pension Investment Board for $68.50 per share.

Kevin Belgrade, a spokesman for Kinetic Concepts, didn’t immediately return a phone call seeking comment.

In a revolving credit facility, money can be borrowed again once it’s repaid; in a term loan, it can’t.

--Editors: Faris Khan, Richard Bedard

To contact the reporter on this story: Christine Idzelis in New York at

To contact the editor responsible for this story: Faris Khan at

The Good Business Issue
blog comments powered by Disqus