Bloomberg News

Phillips Plastics Said to Set Rate on $271.9 Million Term Loan

February 14, 2013

Phillips Plastics Corp., a provider of design and manufacturing services for medical and commercial applications, set the rate it will pay on a $271.9 million term loan, according to a person with knowledge of the transaction.

Proceeds will be used to refinance debt, said the person, who asked not to be identified because the information is private.

The four-year deal will pay interest at 3.5 percentage points more than the London interbank offered rate, said the person. Libor, a rate banks say they can borrow in dollars from each other, will have a 1.25 percent floor.

Phillips Plastics is proposing to sell the loan to new lenders at 99.5 cents on the dollar and existing lenders are being offered a 25 basis-point amendment fee, the person said. A basis point is 0.01 percentage point.

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, according to the person.

Leverage, or debt to earnings before interest, taxes, depreciation and amortization, is expected to be about 4 times total, the person said.

GE Capital Markets, the lending unit of General Electric Co., is arranging the deal for the Hudson, Wisconsin-based company, according to data compiled by Bloomberg.

To contact the reporter on this story: Michael Amato in New York at mamato3@bloomberg.net

To contact the editor responsible for this story: Faris Khan at fkhan33@bloomberg.net


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