Polyconcept Investments BV, a distributor of promotional and gift products, is seeking $540 million of loans to refinance debt, according to two people with knowledge of the transaction.
JPMorgan Chase & Co. is arranging the deal, which includes a $100 million super-senior revolving credit line maturing 2018 and a $440 million term loan due 2020, said the people, who asked not to be identified because the information is private.
The term portion will pay interest at 5.25 or 5.5 percentage points more than the London interbank offered rate, one of the people said. Libor, a rate banks say they can borrow in dollars from each other, will have a 1.25 percent floor, that person said.
Polyconcept is proposing to sell the loan at 98.5 to 99 cents on the dollar, the person said, reducing proceeds for the company and boosting the yield to investors.
Lenders are being offered one-year soft-call protection of 101 cents, meaning the company would have to pay 1 cent more than face value to refinance the debt during the first year, the person said.
Moody’s Investors Service has assigned a Ba2 rating to the revolver, a type of debt where money repaid can be borrowed again, and a B2 rating to the term loan.
The company raised 586 million euros of debt in May 2005 when it was acquired by Investcorp SA, according to data compiled by Bloomberg. The term loan B facilities are due to repay later this year.
To contact the reporters on this story: Julie Miecamp in London at firstname.lastname@example.org; Krista Giovacco in New York at email@example.com
To contact the editor responsible for this story: Faris Khan at firstname.lastname@example.org