The Bank of Ireland has started taking on an increasing number of lead arranger roles in middle-market deals, most recently on a financing for National Vision. One individual said the middle-market group has been building on its sponsor relationships in order to grab the left spot on deals.
Mark McGoldrick, head of U.S. leveraged finance, said the business was started in 2003 with an active, middle-market, sponsor-focused effort, but it wasn't until 2004 that the bank began to seek lead arranger roles. "What you are seeing is an evolution of a business that has been around [for three years]. Each of the last three years [there has been an] increasing rate of lead deals. We started with a very small number in the first year and now we are targeting as much as a dozen a year," he explained.
Since it started lead arranging deals in 2004, McGoldrick estimated the firm had done a dozen or so financings. Recent deals include LTI, an acquisition by Sentinel Capital Partners, which closed in April, and Dynisco, a recapitalization for the company, which is owned by Audax Group. The deal for National Vision consists of a six-year, $170 million term loan "B" and a five-year, $30 million revolver. Pricing is LIBOR plus 2 3/4% on the revolver and LIBOR plus 3% on the term loan. The deal pays around a $55 million dividend to sponsor, Berkshire Partners. It was set to close last Thursday and was already oversubscribed a week before commitments were due. Berkshire bought the company in the fall. A typical BoI-led deal size would be for a company that has $10-50 million of EBITDA or an enterprise value of up to $500 million.
The team has also grown in size. McGoldrick estimated that when the group started, it had about six people and now has more than 20 professionals.