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Oreck Increases Dividend Through RBS Financing

28 Jan 2005

The Royal Bank of Scotland tweaked Oreck Corp.'s bank deal last week, increasing the dividend to sponsor American Securities Capital Partners by $9.4 million from $60.5 million and reducing the interest expense.

The Royal Bank of Scotland tweaked Oreck Corp.'s bank deal last week, increasing the dividend to sponsor American Securities Capital Partners by $9.4 million from $60.5 million and reducing the interest expense. The "B" tranche was increased by $5 million to $195 million and pricing was reverse flexed from LIBOR plus 3% to LIBOR plus 2 3/4%. Everybody is recommitting, a source close to the deal claimed. The credit also includes a $20 million revolver.

RBS led $140 million of senior debt backing ASCP's leveraged buyout of Oreck in March 2003, but improved performance is enabling the vacuum-cleaner company to take out the dividend (LMW, 1/14). Oreck brings in more than $300 million of sales and more than $50 million a year in EBITDA. At the time of the buyout, EBITDA was in the mid-$40 million range, a lender said. The bank debt that is being refinanced is priced at LIBOR plus 4 1/2%. RBS bankers declined comment and David Horing, a managing director with American Securities, did not return calls.

 

28 Jan 2005