Goldman, UBS Back Fenway's Buyout Of Targus
Goldman Sachs and UBS launched syndication of $205 million of loans last Tuesday to back Fenway Partners buyout of Targus International from Apax Partners.
Goldman Sachs and UBS launched syndication of $205 million of loans last Tuesday to back Fenway Partners buyout of Targus International from Apax Partners. The credit consists of a six-year, $40 million revolver and a seven-year, $165 million term loan "B." Pricing on the revolver is LIBOR plus 2 1/2% and pricing on the term loan is LIBOR plus 2 3/4%. The deal also includes $150 million of high-yield sub notes due in 2013. Commitments are due around Nov. 7.
Billy Logan, a principal at Apax, said Fenway approached the company about selling and Apax decided it was the right time to do so. "We are long-term investors and the company had a great period of expansion, it quadrupled revenues, and when Fenway approached us with an offer, the evaluation was compelling and we decided it was the right time for the transaction," he said. Apax first invested in Targus in 1996.
Moody's Investors Service assigned a B1 to the bank loans and a B3 to the notes. It was a first-time rating of the company. Moody's writes that the long-term ratings reflect the company's high financial leverage and large amount of competition. But the agency says there are favorable growth trends for notebook cases and computer accessories and the company has good worldwide revenue diversity.
Calls to Targus were not returned. Timothy Mayhew, managing director at Fenway, could not be reached.